PROJECT PERFORMANCE PROJECT PERFORMANCE AND EVALUATIONAND EVALUATION

Year 3 Project ManagementYear 3 Project Management

Dr. Margaret NelsonDr. Margaret Nelson

LECTURE OUTLINELECTURE OUTLINE

Project PerformanceProject Performance– OverviewOverview– Setting CriteriaSetting Criteria– Monitoring ProgressMonitoring Progress– Measuring PerformanceMeasuring Performance

Project EvaluationProject Evaluation– AuditAudit– ReviewReview

PROJECT PROJECT PERFORMANCEPERFORMANCE

2 Aspects2 Aspects1.1. Project ProcessesProject Processes2.2. Project OutcomesProject Outcomes

Project Performance ManagementProject Performance Management PlanningPlanning MonitoringMonitoring ControllingControlling MeasuringMeasuring Reviewing & EvaluatingReviewing & Evaluating Feed forwardFeed forward

Principles of Conformance ManagementPrinciples of Conformance ManagementInspection Inspection Quality control Quality control Quality assuranceQuality assuranceApproaches to quality managementApproaches to quality management

– empowerment<>blame orientationempowerment<>blame orientation– reactive <> proactivereactive <> proactive

PERFORMANCE V PERFORMANCE V CONFORMANCECONFORMANCE

CONFORMANCE CONFORMANCE MANAGEMENTMANAGEMENT

total quality management

quality assurance

quality control

inspection

reactive proactive

blameorientated

empowerment

CRITERIA SETTINGCRITERIA SETTING

Based on project objectivesBased on project objectives– Linked to business objectives and goalsLinked to business objectives and goals

Criteria for successCriteria for successKey Performance Indicators (KPI) or Key Key Performance Indicators (KPI) or Key

Success Indicators (KSI)Success Indicators (KSI)

MONITORING MONITORING PROGRESSPROGRESS

Information System StructureInformation System Structure– What data are collected?What data are collected?

Current status of project (schedule and cost)Current status of project (schedule and cost)

Remaining cost to compete projectRemaining cost to compete project

Date that project will be completeDate that project will be complete

Potential problems to be addressed nowPotential problems to be addressed now

Out-of-control activities requiring interventionOut-of-control activities requiring intervention

Cost and/or schedule overruns and the reasons for themCost and/or schedule overruns and the reasons for them

Forecast of overruns at time of project completionForecast of overruns at time of project completion

Information System Structure (cont’d)Information System Structure (cont’d)– Collecting data and analysisCollecting data and analysis

Who will collect project data?Who will collect project data?

How will data be collected?How will data be collected?

When will the data be collected?When will the data be collected?

Who will compile and analyze the data?Who will compile and analyze the data?

– Reports and reportingReports and reportingWho will receive the reports?Who will receive the reports?

How will the reports be transmitted?How will the reports be transmitted?

When will the reports be distributed?When will the reports be distributed?

MONITORING MONITORING PROGRESS (2)PROGRESS (2)

PROJECT PROGRESS PROJECT PROGRESS REPORT FORMATREPORT FORMAT

Progress since last reportProgress since last reportCurrent status of projectCurrent status of project

– ScheduleSchedule

– CostCost

– ScopeScope

Cumulative trendsCumulative trendsProblems and issues since last reportProblems and issues since last report

– Actions and resolution of earlier problemsActions and resolution of earlier problems

– New variances and problems identifiedNew variances and problems identified

Corrective action plannedCorrective action planned

PROJECT CONTROL PROJECT CONTROL PROCESSPROCESS

ControlControl– The process of comparing actual performance The process of comparing actual performance

against plan to identify deviations, evaluate courses against plan to identify deviations, evaluate courses of action, and take appropriate corrective action.of action, and take appropriate corrective action.

Project Control StepsProject Control Steps1.1. Setting a baseline plan.Setting a baseline plan.

2.2. Measuring progress and performance.Measuring progress and performance.

3.3. Comparing plan against actual.Comparing plan against actual.

4.4. Taking actionsTaking actions

MONITORING TIME MONITORING TIME PERFORMANCEPERFORMANCE

Tools used to catch negative variances from plan and Tools used to catch negative variances from plan and communicate project schedule status:communicate project schedule status:

– Tracking and baseline Gantt chartsTracking and baseline Gantt charts

Show expected, actual, and trend data for event duration Show expected, actual, and trend data for event duration performance.performance.

– http://pubs.logicalexpressions.com/Pub0009/LPMArticle.asp?ID=577http://pubs.logicalexpressions.com/Pub0009/LPMArticle.asp?ID=577

– http://www.projectconnections.com/knowhow/template_list/subjects/pmhttp://www.projectconnections.com/knowhow/template_list/subjects/pm_skills/tracking.html?gclid_skills/tracking.html?gclid=CMyLy8W8s4ICFTZLEgodmyxCAw=CMyLy8W8s4ICFTZLEgodmyxCAw

– Control chartsControl charts

Plot the difference in scheduled time on the critical path with the Plot the difference in scheduled time on the critical path with the actual point on the critical path.actual point on the critical path.

DISPARITY AMONG DISPARITY AMONG MONITORING SYSTEMSMONITORING SYSTEMS

Time-Phase Baseline PlanTime-Phase Baseline Plan– Corrects the failure of most monitoring systems to connect a Corrects the failure of most monitoring systems to connect a

project’s actual performance to its schedule and forecast budget.project’s actual performance to its schedule and forecast budget.

Systems that measure only cost variances do not identify resource Systems that measure only cost variances do not identify resource and project cost problems associated with falling behind or and project cost problems associated with falling behind or progressing ahead of schedule.progressing ahead of schedule.

Earned Value Cost/Schedule SystemEarned Value Cost/Schedule System– An integrated project management system based on the earned An integrated project management system based on the earned

value concept that uses a time-phased budget baseline to value concept that uses a time-phased budget baseline to compare actual and planned schedule and costs.compare actual and planned schedule and costs.

DEV’T OF PROJECT DEV’T OF PROJECT BASELINESBASELINES

Purposes of a Baseline (PV)Purposes of a Baseline (PV)– An anchor point for measuring performanceAn anchor point for measuring performance

A planned cost and expected schedule against which actual cost A planned cost and expected schedule against which actual cost and schedule are measured.and schedule are measured.

A basis for cash flows and awarding progress payments.A basis for cash flows and awarding progress payments.

A summation of time-phased budgets (cost accounts as summed A summation of time-phased budgets (cost accounts as summed work packages) along a project timeline.work packages) along a project timeline.

What Costs Are Included in Baselines?What Costs Are Included in Baselines?– LabourLabour– EquipmentEquipment– MaterialsMaterials– Project direct overhead costs (DOC)Project direct overhead costs (DOC)

Rules for Placing Costs in BaselinesRules for Placing Costs in Baselines– Costs are placed exactly as they are expected Costs are placed exactly as they are expected

to be “earned” in order to track them to their to be “earned” in order to track them to their point of origin.point of origin.

– Percent Complete RulePercent Complete RuleCosts are periodically assigned to a baseline as Costs are periodically assigned to a baseline as units of work are completed over the duration of a units of work are completed over the duration of a work package.work package.

DEV’T OF PROJECT DEV’T OF PROJECT BASELINES (2)BASELINES (2)

PROGRESS PROGRESS MONITORING INDICESMONITORING INDICES

Performance IndicesPerformance Indices– Cost Performance Index (Cost Performance Index (CPICPI))

Measures the cost efficiency of work accomplished to date.Measures the cost efficiency of work accomplished to date.

CPI = EV/ACCPI = EV/AC

– Scheduling Performance Index (Scheduling Performance Index (SPISPI))Measures scheduling efficiencyMeasures scheduling efficiency

SPI = EV/PVSPI = EV/PV

– Percent Complete IndexesPercent Complete IndexesIndicates how much of the work accomplished represents of Indicates how much of the work accomplished represents of the total budgeted (BAC) and actual (AC) pounds to date.the total budgeted (BAC) and actual (AC) pounds to date.

PCIB = EV/BAC PCIB = EV/BAC

PCIC = AC/EACPCIC = AC/EAC

OTHER CONTROL OTHER CONTROL ISSUESISSUES

Issues In Maintaining Control Of ProjectsIssues In Maintaining Control Of ProjectsIssues In Maintaining Control Of ProjectsIssues In Maintaining Control Of Projects

Baseline ChangesBaseline ChangesBaseline ChangesBaseline Changes

Contingency ReserveContingency ReserveContingency ReserveContingency Reserve

Costs andCosts and Problems of Data AcquisitionProblems of Data AcquisitionCosts andCosts and Problems of Data AcquisitionProblems of Data Acquisition

Scope CreepScope CreepScope CreepScope Creep

Managing the Portfolio of ProjectsManaging the Portfolio of ProjectsManaging the Portfolio of ProjectsManaging the Portfolio of Projects

SCOPE CHANGES SCOPE CHANGES TO A BASELINETO A BASELINE

PROJECT EVALUATIONPROJECT EVALUATION

‘Evaluate’ - to judge or calculate the quality, importance, amount or value of something

WHAT DO WE MEAN BY WHAT DO WE MEAN BY PROJECT SUCCESS?PROJECT SUCCESS?

Appropriate intentionAppropriate intentionPredictability of realisationPredictability of realisationMinimisation of client surpriseMinimisation of client surpriseDefining project success Defining project success

– project and process integrityproject and process integrity

GAPS IN GAPS IN PERCEPTIONPERCEPTION

problemproblemBriefing problemBriefing problemDesign problemDesign problemPlanning problemPlanning problemExecution problemExecution problemProject performance Project performance gap gap

outcomeoutcomeBrief Brief Complete definitionComplete definitionComplete descriptionComplete descriptionCompleted facilityCompleted facilityClient surpriseClient surprise

PROJECT AUDITPROJECT AUDIT

Audit - to make an official examination Audit - to make an official examination Health check Health check The whole point of a project audit is to get a The whole point of a project audit is to get a

reality-based, accurate picture of a project's reality-based, accurate picture of a project's expenditures, schedule and quality of work. expenditures, schedule and quality of work. Think of it as a super-sized project status report Think of it as a super-sized project status report

Diagnose & Treat problems / issues affecting Diagnose & Treat problems / issues affecting project performanceproject performance

Helps in addressing the critical issuesHelps in addressing the critical issues

WHY NEEDED?WHY NEEDED?

Ensure they are performing correctly Ensure they are performing correctly Highlight any areas where there may be shortfalls or Highlight any areas where there may be shortfalls or

where additional assessments are needed where additional assessments are needed Check improvement plans are adequate and being Check improvement plans are adequate and being

correctly executed correctly executed Verify that the measurements employed are appropriate, Verify that the measurements employed are appropriate,

consistent, correct and complete consistent, correct and complete Indicate what corrective actions can be instigated to Indicate what corrective actions can be instigated to

correct deviations correct deviations Provide input, such as lessons learned, into the next Provide input, such as lessons learned, into the next

planning cycle planning cycle

PROJECT REVIEWPROJECT REVIEW

Review - When you consider something again in order to make changes to Review - When you consider something again in order to make changes to it, give an opinion of it or study it it, give an opinion of it or study it

Post Project Review process consists of activities performed by a project Post Project Review process consists of activities performed by a project team at the end of the project’s life cycle (or at the end of significant phases team at the end of the project’s life cycle (or at the end of significant phases of work) to gather information on what worked well and what did not, so that of work) to gather information on what worked well and what did not, so that future projects can benefit from that learning future projects can benefit from that learning

Measures whether the benefits of a Measures whether the benefits of a project'sproject's outcomes have been realised outcomes have been realised – to measure if expected benefits of the project have been realised to measure if expected benefits of the project have been realised – to indicate if the project has caused any problems/opportunities while in use to indicate if the project has caused any problems/opportunities while in use – gauges Client’s / User's comments about performance, reliability, suitability and gauges Client’s / User's comments about performance, reliability, suitability and

ease of use of the end product ease of use of the end product – planned as part of identifying Follow-on Actions but created after the product has planned as part of identifying Follow-on Actions but created after the product has

finished finished Could have various stages of reviewsCould have various stages of reviews The Office of Government Commerce (OGC) developed the Gateway The Office of Government Commerce (OGC) developed the Gateway

Project Review Process and introduced it across Central Civil Government Project Review Process and introduced it across Central Civil Government as part of the Modernisation Agenda, to support the delivery of improved as part of the Modernisation Agenda, to support the delivery of improved Public Services. The process has been operating since January 2001.Public Services. The process has been operating since January 2001.

What is the difference between What is the difference between an Audit and a Review?an Audit and a Review?

READING LISTREADING LIST

Gray, C.F. & Larson, E.W. (2006), Project Management: Gray, C.F. & Larson, E.W. (2006), Project Management: The Managerial Process, NY: McGraw-Hill The Managerial Process, NY: McGraw-Hill International/Irwin.International/Irwin.

Reiss, G. (1995), Project Management Demystified: Reiss, G. (1995), Project Management Demystified: Today’s Tools and Techniques, 2Today’s Tools and Techniques, 2ndnd Edition, Edition,

Winch, G. Lecture NotesWinch, G. Lecture Notes http://http://www.blackwellpublishing.com/winch/case.pdfwww.blackwellpublishing.com/winch/case.pdf http://www.ce.cmu.edu/pmbook/http://www.ce.cmu.edu/pmbook/ http://www.constructingexcellence.org.ukhttp://www.constructingexcellence.org.uk http://www.maxwideman.com/guests/index.htmhttp://www.maxwideman.com/guests/index.htm

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