CHAPTER 7: MONITORING AND CONTROLLING THE PROJECT

PROJECT MANAGEMENT SYSTEM

MONITORING AND CONTROL

• Monitoring is the collection, recording, and reporting of project
information.
• Control uses the monitored data to bring actual performance into
agreement with the plan
• Monitoring and control are the opposite sides of project selection and
planning
- Project selection dictates what to monitor
- Project planning identifies the elements to be controlled

THE PLAN-MONITORING-CONTROL CYCLE

Fundamental items
(1) Time
(2) Cost
(3) Scope

The plan-monitor-control cycle constitutes a “closed-loop” process that

continues until the project is completed.

With complex projects, there is a temptation to minimize planning-monitoring-

controlling effort so that “real work” can be done

DESIGNING THE MONITOR SYSTEM

 Chapter 7: Monitoring and Controlling the Project 1) Frequency counts
2) Raw numbers
Monitoring and Control 3) Subjective numeric ratings
• Monitoring is the collection, recording, and reporting of project 4) Indicators and surrogates
information 5) Verbal characterizations
• Control uses the monitored data to bring actual performance into Data Analysis
agreement with the plan • Data analysis techniques
• Monitoring and control are the opposite sides of project selection and - Simple aggregation
planning o Averaging, for example
- Project selection dictates what to monitor - Fitting statistical distribution functions to the data
- Project planning identifies the elements to be controlled - Curve fitting
Plan-Monitor-Control Cycle • Significant differences from the plan should be flagged
• The plan–monitor-control cycle constitutes a “closed loop” process Reporting and Report Types
- Continues until the project is completed • Routine performance reports
• With complex projects, there is a temptation to minimize the - Project status reports
planning–monitoring–controlling effort so that “real work” can be - Time/Cost reports
done - Variance reports
- It is these projects that need the planning–monitoring–controlling • Avoid periodic or routine reports
process the most • Not all stakeholders need to receive same information
Designing the Monitoring System • Electronic media makes it possible to customize information for
• Identify special characteristics of scope, cost, and time that need to be difference audiences
controlled • Reports should be timed to allow control to be exercised before
- Specific performance characteristics should be set for each level of completion of the task in question
detail in the project Report Types
• Real-time data must be identified to measure achievement against the 1. Routine
plan Status, progress, and forecast reports
• It is important to avoid the tendency to focus on easily collected data 2. Exception
Data Collection and Reporting A report used for special decisions or unexpected situations where
• Once data to monitor has been decided, mechanisms to collect this affected team members need to be made aware, and the change
data must be designed itself documented
• Analysis is used to transform data into information 3. Special analysis
• A number of questions come up: The results of a special study which documents a particular
o Should we use special forms? opportunity or problem within the project itself
o Should data be collected before/after milestones?
o Should time and cost data be collected at the same time?
Data Collecting Additional Report Benefits
 • They provide the mutual understanding between stakeholders in a • The earned value (EV) of a task or project is the budgeted cost of the
project work actually done
• They help communicate the need for coordination among those It is calculated by multiplying the budgeted cost of the task by the
working on project percentage completion of the task
• They establish and maintain a communication network for global Process is more difficult than it sounds
projects o Budgeted cost of a task is clear
• Reports can communicate information about changes to a project o Percentage of completion is not
• They help maintain the visibility of the project • The percent of a task’s budget actually spent is not good indicator of
• They improve motivation percent completion
Meetings Conventions Used to Estimate Progress on Tasks
• Many reports are delivered at meetings • 50-50
• Meetings range from regular, highly formalized and structured sessions Task is listed as 50% complete when initiated and the remaining
to informal, off-the-cuff get-togethers 50% added when task is completed
- Presentations • 100%
- Question and answer sessions The task is 100% complete when finished … and zero percent
• Meetings must be well run to be effective before that
Meeting Guidelines projects will always appear to be “behind schedule”
• Meetings should be used primarily for group decision making, not for • Ratio of cost (or time) expended to cost (or time) budgeted
mere progress reports Neither is an accurate estimator of percentage completion
• Distribute written agenda in advance of meeting to ensure that all • These conventions are meant for application only to individual tasks on
attendees are properly prepared for the meeting a project, not to the project as a whole
• For a crisis meeting, restrict discussion to that issue Two Simple Rules for Variances
• Meeting should take minutes 1. A negative variance is bad and a positive variance is good
- Avoid attributing remarks to individuals in the minutes 2. The spending and schedule variances are calculated as the earned
• Avoid excessive formality value minus some other measure
• If meeting is held to address specific crisis, restrict meeting to this issue Variances
alone • Cost/Spending variance
Virtual Reports, Meetings, and Project Management Earned value (EV) – actual cost (AC)
• The Internet can be used to communicate and report about the • Schedule variance
project’s status Earned value (EV) – planned cost (PV)
- Irrespective of the location of the project team members • CPI (cost performance index)
• Software programs allow the project manager to utilize the Earned value (EV)/actual cost (AC)
organization’ local area network or intranet • SPI (schedule performance index)
• Virtual project teams have members spread worldwide Earned value (EV)/planned cost (PV)

Earned Value Additional Items of Interest

 • Estimated remaining cost to completion Primary Mechanisms by which Project Manager Exerts Control
ETC = (BAC – EV) / CPI 1. Process reviews
ETC: estimated cost to completion • An analysis of the process of reaching the project objectives
BAC: budget at completion 2. Personnel assignment
EV: earned value • Control can also be exercised through personnel assignments based on
CPI: cost performance index past productivity
• Estimated total cost at completion 3. Resource allocation
EAC = ETC + AC • Resources are usually allocated to the more productive or important
EAC: estimated at completion tasks and this can significantly influence the attainment of project
ETC: estimated cost to completion results
AC: actual cost Common Mistakes
Project Control • Emphasizing short-run results at the expense of long-run objectives
• Control, the act of reducing differences between the plan and actuality • Excessive control directed to specific objectives can result in sacrificing
• It is the final element in the planning-monitoring-controlling cycle other project objectives
• It is to no avail if actions are not taken when reality deviates • Across-the-board cuts in resource allocations tend to reward those
significantly from what was planned who have already overspent or over hired while penalizing the frugal
• Control is a difficult task and efficient
- It involves human behavior • Focusing on certain items for control can distract the attention of team
- Problems are rarely clear cut so the need for change and members from other, equally important items
redirection is also fuzzy Control System Components
Purposes of Control • Sensor
1. Stewardship of organizational assets - Its purpose is to measure any aspect that one wishes to control
- Physical asset control • Standard
- Human resources management - The control system must have a standard of items to measure
- Financial control through the use of accounting tools against
2. Regulation of results through the alteration of activities • Comparator
- This step involves taking action when reality deviates from plan - Compares the output of the sensor with the standard
- It includes both mechanistic and human elements • Decision maker
Purposes of a Control System - To decide if the difference between what is measured and the
• Primary purpose is to correct errors standard is large enough to warrant attention.
Not to identify and punish the guilty • Effector
Managers must realize that the past cannot be changed - If some action is required to reduce the difference, the effector
• Control the investment, subject to diminishing returns must then take action
• Consider impact on creativity and innovation
• The control system should employ the lowest degree of hassle Types of Control Systems
consistent with accomplishing its goals • Cybernetic control systems
 - A control system that uses all five components of a control system • Identify all impacts
Also known as steering controls • Translate impacts into performance, schedule, and cost
• Go/no-go controls • Evaluate the benefits and disadvantages
- A predetermined standard must be met for permission to be • Have appropriate person accept or reject
granted to continue • Communicate accepted changes
• Post-control (post-performance reviews) • Ensure changes are implemented properly
- Applied after the project has been completed • Prepare report
Purpose is to allow future projects to learn from past project Rules for Controlling Scope Creep
experience • Include a change control system in every project contract
Tools for Control • Require all changes be introduced by a change order
• Some already covered • Require approval in writing by the client’s agent and senior
- Variance analysis management
- Trend projections • Consult with project manager prior to preparation of change order
- Earned value • Amend master plan to reflect changes
• Critical ratio
- Indicates when a task is becoming unacceptable
o When the ratio drops below one
CR = (actual progress/scheduled progress)  (budgeted cost/actual
cost)
More Tools for Control
• Control chart
- Any measure can be plotted and tracked on a control chart
- Control limits set by project manager
• Benchmarking
- Make comparisons to “best in class” practices across organizations,
or divisions, or even departments within an organization
Scope Creep and Change Control
• Midcourse changes to a project must be controlled
- Called scope creep
• The later changes are made to a project, the more difficult and costly
they become
• All projects face change
• The best approach is a well-controlled, formal process for change

Purpose of Change Control System

• Review all requested changes