Project Management (x470) Module 04 : Knowing Wherethe Project Is&Closing
Homework discussion • Short Quiz 3 • Knowing Where The Project Is • Execution Focus • Status Reporting • Traffic Light • Earned Value • Change Control • Team Development • Conflicts • Monitor & Control Best Practices Session 4 Agenda
Project Execution Knowing What the Project Is
To provide goal-centered feedback to detect and correct the course • What data is relevant? • Where is it best collected? • Who should analyze and act on it? • When should it be done? Knowing Where the Project Is:Why Metrics? Measurements mated with analysis and action!
Traffic Light Reporting Knowing Where the Project Is:Project Performance Data
Knowing Where the Project Is:Traffic Light Reporting Need to define what the colors mean!
Project Trend Problem Statement Metric Scope Schedule Corrective Action Executive Summary Status Cost Overall Health Challenges Next Steps Results Working Knowing Where the Project Is:Project Dashboard Significant results for the reporting period. Significant work to be started for the next reporting period. Significant work in progress for the reporting period. Major issues, constraints, etc.
Trigger point for Schedule ‘color’ can be tighter • Trigger point for Cost color can be looser Knowing Where the Project Is:Flexibility Matrix and Status Trigger
Planned Value (PV) – the physical work scheduled to be performed, including the estimated value of this work. (a.k.a. Budgeted Cost of Work Scheduled - BCWS) Schedule and cost status reporting tool! • Earned Value (EV)– the physical work actually accomplished, including the estimated value of this work. (a.k.a. Budgeted Cost of Work Performed - BCWP) Knowing Where the Project Is:Earned Value Management • Actual Cost (AC) - the actual cost incurred to accomplish the earned value. (Actual Cost of Worked Performed - ACWP) 16
Money Spent = $1350 % Complete = 2/3 Task Budget = $1500 Today A work on a project task is expected to cost $1500 to complete and the workers were scheduled to finish today. As of today however, the workers have actually expended $1350 and the best estimate is the task is 2/3 complete. Determine the Planned Value, Actual Cost and Earned Value at this point in time. PV = 1500 Knowing Where the Project Is:Earned Value Example AC = 1350 EV = (2/3)(1500) = 1000 17
Other Formulae • Actual plus new Estimate To Complete • EAC = AC + ETC • Actual plus budget (PV) for remaining deliverables • EAC = AC + (BAC – EV) • Actual plus budget for remaining deliverables modified by the performance index • EAC = AC + (BAC – EV)/CPI AC EAC = (BAC) X EV The estimate at completion is the best estimate of the total cost at the completion of the project. The EAC is a periodic evaluation of the status of the project - usually on a monthly basis or until a significant change has been identified. Knowing Where the Project Is: Estimate at Completion 19
Time of measurement PV SV AC CV CUMMULATIVE COST, $ Knowing Where the Project Is: Earned Value Status Reporting EV TIME 20
Project: Software enhancement for a drug company Baseline: Entire effort priced at $200K and scheduled for completion June 10th As of June 10: Project cost to date is $195K. One activity is left in the project estimated to cost S25K. Find cost and schedule variance amounts, cost and schedule variance percentages, cost and schedule performance indexes, and estimate at completion amount. Knowing Where the Project Is: Using Earned Value II 22
Given: BAC = $200K, PV = $200K, AC = $195K Last Activity Cost = $25K Solution: EV = 200K – 25K = $175K CV = EV – AC = 175K- 195K = -$20K SV = EV – PV = 175K – 200K = -$25K CV% = (CV / EV) 100% = (-20/175) 100% = -11% SV % = (SV / PV) 100% = (-25/200) 100% = -12.5% CPI = EV / AC = 175 / 195 = .897 SPI = EV / PV = 175 / 200 = .875 Knowing Where the Project Is: Using EV II Solution 23
EAC1 = (AC/EV) x BAC = (195/175)200K = $223K EAC2 = AC + (BAC – EV) = 195K + 200K – 175K = 220K EAC3= AC + (BAC – EV)/CPI = 195K + (200K-175K)/.897 = $223K ETC = EAC – AC = 223 – 195 = 28K Knowing Where the Project Is: Using EV II Solution (cont.) 24
Project: Construction of a new house Baseline: Entire effort priced at $1.2M and scheduled for completion January next year. As of July 1: First project activity is a site survey with a budget of $80K. By July 1st, half of the site survey is expected to be completed. Cost to date is $60K and work is already 80% complete. Find cost and schedule variance amounts, cost and schedule variance percentages, cost and schedule performance indexes, and estimate at completion amount. Knowing Where the Project Is: Using Earned Value III 25
Week 1 Using Earned Value IV
Knowing Where the Project Is: Using Earned Value: HW Gantt Chart Week 1 Week 2 30
Objective Manage changes to project via an approved change control process Deliverable Approved / rejected change request document Updated project and product process deliverables Knowing Where the Project Is:Project Change Control
Resources • Enhancement of stakeholders’ ability to contribute as individual and team’s ability to function as a team • Team building activities • Reward and recognition • Training • Stages of team growth • Learning team – core capabilities Project Manager Project Team Development Deliverables Projects are managed through its people!
Formalized review process with participation from management on issue resolution Gate review Status review Check-in, stay in-touch Maintain an open environment Tracking intensity proportionate to project importance / priority Knowing Where the Project Is:Monitor & Control “Best Practices”
Project Closure Knowing What the Project Is
Monitor and Control Objectives: (1) Clear project definition, (2) Clear project status, (3) Keep the project on track Close • Project Management Deliverables: • Primary • Project completion / termination sign-off • Secondary • Lessons learned • Contracts closed Knowing WHERE the project is. • Determine and communicate project status • Usual reports: • Status Report • Issues and Action Items Log • Meeting Minutes • Objectives: • Formal end of all project work • Turn-over of project products Project Close
Product / Service Processes The Last Words
The Last Words (Almost…) • SDLC – Waterfall, Agile, RUP • IT Infrastructure Library • Biotech • Construction • Others Monitor & Control Product Oriented Practices / Deliverables
Scoping / Requirements Initiate Plan - Validation and approval of clear project baseline Planning Implementation Turn-Over Close - Formal end of all project work Execute - Completion of deliverables per the project management plans Knowing what the project is. Knowing where the project is. Monitor and Control - (1) Clear project definition, (2) Clear project status, (3) Keep the project on track Seller Responses Deliverables Completed Training Team Building Reward/Recognition Change Request Project Schedule Cost Baseline RAM Communication Plan Risk Response Plan Seller Responses Project Management Deliverable Map Scope Statement WBS Status Report, etc... Status Report, etc... Status Report, etc... Status Report, etc... Product process deliverables
Level 5 Continuous Improvement Level 3 Singular Methodology Level 4 Continuously Improve Level 1 Common Language Level 2 Common Processes Level 1 Standardize Level 2 Repeatable Level 5 Optimizing Level 4 Managed Level 2 Measure Level 3 Defined Level 3 Control Level 1 Initial Level 4 Benchmarking Harold Kezner SEI, CMM Project Management Maturity Models OPM3, PMI Standard methodology. Should include development of project portfolio management process.
Portfolio – a collection of projects or programs and other work that are grouped together to facilitate effective management of that work to meet strategic business objectives Programs – a group of related projects managed in a coordinated way to obtain benefits and control not available from managing them individually Portfolio Program Project Hierarchy Project
Deliverable complexity (low or high) Deliverable quantity (few or many) Deliverable size (small or large) Number of people (few or many) Degree of interdependence (simple or complex) Details of Agreements (tasks only or detailed interfaces) Co-location of teams Project or Program?
Centralizes and coordinate the management of projects under its domain Operates on a continuum from providing only project management support functions to actual direct management and responsibility for meeting project objectives Sometimes called Center of Excellence (COE) Project Management Office
Doing the Right Work Knowing What is Best • Alignment of projects with strategic business objectives • Prioritization • Org. Capacity planning G O V E R N A N C E ITIL Project Organizational Context Doing the Work Right • Project Life Cycle • PMBOK Guide • Product delivery best practices
Project based (driven) - work is characterized through projects, with each project as a separate cost center having its own P&L statement (ex. construction, aerospace) Non-project based (driven) - projects exist to support product or functional lines, P&L measured on vertical or functional lines, priority given to revenue producing functional line activities Organizational System
Types are described in terms of the project manager level of authority Functional (Traditional, Classical) Matrix Projectized Organizational Structures
GM Engineering Production Marketing Sales Admin Functional Organizational Structure
General Manager Project BManager Project AManager Project CManager Projectized Organizational Structure ENG. MFG. ENG. ENG. MFG. MFG.
Project Mgr. Y Project Mgr. X Project Mgr. Z Director: Project Mgmt. Director: Finance/Admin. Director: Engineering Director: Manufacturing General Manager The Matrix Management Structure(With a Director of Project Management)
PM Authority High Organizational Structure & PM Authority Low Functional Matrix Projectized Organizational Structure