1. Project Management: A Managerial Approach
Chapter 10 – Monitoring and Information Systems

2. Overview Closed-loop System Monitor System Design Data Collection
Project Reports
Earned Value Charts

3. Monitoring and Information Systems
Evaluation and control of projects are the opposite sides of project selection and planning
Logic of selection dictates the components to be evaluated
The details of the planning expose the elements to be controlled
Monitoring is the collecting, recording, and reporting information concerning any and all aspects of project performance

4. The Planning - Monitoring - Controlling Cycle
The key things to be planned, monitored, and controlled are time (schedule), cost (budget), and specifications
The planning methods require a significantly greater investment of time and energy early in the life cycle of the project
These methods significantly reduce the extent and cost of poor performance and time/cost overruns

5. The Planning - Monitoring - Controlling Cycle
The control process should be perceived as a closed loop system
In a closed loop system, revised plans and schedules should follow corrective actions
The planning-monitoring-controlling cycle is continuously in process until the project is complete

6. Project Control Closed-Loop
PLANNING/SCHEDULING FEEDBACK LOOPS
Develop
Functional
Specs
Verify
Specs w/
“Customer
“Customer”
IDs Need
“Ballpark”
Resource
Estimates
Functional
Specs to
Design Specs
Design Specs
to Engineer-
ing Specs
REPORT/MONITOR FEEDBACK LOOPS
MANAGEMENT FEEDBACK LOOPS
“Project Plan
And Schedule”
Implement,
Monitor, &
Control
Stakeholder
Feedback
PM TEAM FEEDBACK LOOPS

7. Information Flow for the Planning - Monitoring - Controlling Cycle

8. Designing the Monitoring System
The first step in setting up any monitoring system is to identify the key factors to be controlled
The project manager must define precisely which specific characteristics of performance, cost, and time should be controlled
Exact boundaries must then be established, within which control should be maintained

9. Designing the Monitoring System
The best source of items to be monitored is the project action plan
The monitoring system is a direct connection between planning and control
It is common to focus monitoring activities on data that are easily gathered - rather than important
Monitoring should concentrate primarily on measuring various facets of output rather than intensity of activity

10. Designing the Monitoring System
The measurement of project performance usually poses the most difficult data gathering problem
Performance criteria, standards, and data collection procedures must be established for each of the factors to be measured
Information to be collected may consist of accounting data, operating data, engineering test data, customer reactions, specification changes and the like

11. Monitoring for Effectiveness
Monitoring can serve to maintain high morale on the project team
Monitoring can also alert team members to problems that will have to be solved
The purpose of the monitoring system is to gather and report data
The purpose of the control system is to act on the data

12. Data Collection Sources
It is necessary to define precisely what pieces of information should be gathered and when
A large proportion of all data collected take one of the following forms:
Frequency counts
Raw numbers
Subjective numeric ratings
Indicators
Verbal measures

13. Data Collection Reports
After data collection has been completed, reports on progress should be generated
These reports include project status reports, time/cost reports, and variance reports
Causes and effects should be identified and trends noted
Plans, charts and tables should be updated on a timely basis

14. How to Collect Data
A count of “bugs” found during a series of tests run on a new piece of software:

15. How to Collect Data
Percent of specified performance met during repeated trials

16. Data Diagnosis
Significant differences from plan should be highlighted or “flagged” so that they cannot be overlooked by the controller
Some care should be given to the issues of honesty and bias
An internal audit serves the purpose of ensuring all information gathered is honest
No audit can prevent bias - all data are biased by those who report them

17. How to Collect Data
The project manager is often dependent on team members to call attention to problems
The project manager must make sure that the bearer of bad news is not punished; nor the admitter-to-error executed
The hider-of-mistakes may be shot with impunity - and then sent to corporate Siberia

18. Reporting Process
The monitoring system ought to be constructed so that it addresses every level of management
Reports do not need to be of the same depth or at the same frequency for each level
The relationship of project reports to the project action plan or WBS is the key to the determination of both report content and frequency

19. Reporting Process Effectiveness
Reports must contain data relevant to the control of specific tasks that are being carried out according to a specific schedule
The frequency of reporting should be great enough to allow control to be exerted during or before the period in which the task is scheduled for completion
The timing of reports should generally correspond to the timing of project milestones

20. Monitoring System Drivers
The nature of the monitoring system should be consistent with the logic of the planning, budgeting, and scheduling systems
The primary objective is to ensure achievement of the project plan through control
The scheduling and resource usage columns of the project action plan will serve as the key to the design of project reports

21. Reporting Outcomes
Benefits of detailed, timely reports delivered to the proper people:
Mutual understanding of the goals of the project
Awareness of the progress of parallel activities
More realistic planning for the needs of all groups
Understanding the relationships of individual tasks to one another and the overall project
Early warning signals of potential problems and delays
Faster management action in response to unacceptable or inappropriate work
Higher visibility to top management

22. Report Types
For the purposes of project management, we can consider three distinct types of reports:
Routine - Regular
Exception – Management Interest
Special analysis – “Lessons Learned”

23. Report Types Exception reports are useful in two cases:
First, they are directly oriented to project management decision making and should be distributed to the team members who will have a prime responsibility for decisions
Second, they may be used when a decision is made on an exception basis and it is desirable to inform other managers as well as to document the decision

24. Report Types
Special analysis reports are used to disseminate the results of special studies conducted as a part of the project
These reports may also be used in response to special problems that arise during the project
Usually they cover matters that may be of interest to other project managers, or make use of analytic methods that might be helpful on other projects

25. Meetings
Most often, reports are delivered in face-to-face meetings, and in telephone conference calls
Some simple rules can lead to more productive meetings:
Use meetings for making group decisions
Have preset starting and stopping times
Make sure that homework is done prior to the meeting

26. Meetings Some simple rules for more productive meetings (cont.):
Avoid attributing remarks or viewpoints to individuals in the meeting minutes
Avoid overly formal rules of procedure
If a serious problem or crisis arises, call a meeting for the purpose of dealing with that issue only

27. Common Reporting Problems
There are three common difficulties in the design of project reports:
There is usually too much detail, both in the reports themselves and the input being solicited from workers
Poor interface between the project information system and the parent firm’s information system
Poor correspondence between the planning and the monitoring systems

28. The Earned Value Chart
One way of measuring overall performance is by using an aggregate performance measure called earned value
A serious difficulty with comparing actual expenditures against budgeted or baseline is that the comparison fails to take into account the amount of work accomplished relative to the cost incurred

29. The Earned Value Chart
The earned value of work performed (value completed) for those tasks in progress is found by multiplying the estimated percent completion for each task by the planned cost for that task
The result is the amount that should have been spent on the task so far
The concept of earned value combines cost reporting and aggregate performance reporting into one comprehensive chart

30. The Earned Value Chart
Graph to evaluate cost and performance to date:

31. The Earned Value Chart
Variances on the earned value chart follow two primary guidelines:
1. A negative is means there is a deviation from plan - not good
2. The cost variances are calculated as the earned value minus some other measure
EV - Earned Value: budgeted cost of work performed
AC - actual cost of work performed
PV - Planned Value: budgeted cost of work scheduled
ST - scheduled time for work performed
AT - actual time of work performed

32. The Earned Value Chart
EV - AC = cost variance (CV, overrun is negative)
EV - PV = schedule variance (SV, late is negative)
ST - AT = time variance (TV, delay is negative)
If the earned value chart shows a cost overrun or performance underrun, the project manager must figure out what to do to get the system back on target
Options may include borrowing resources, or holding a meeting of project team members to suggest solutions, or notifying the client that the project may be late or over budget

33. The Earned Value Chart
Variances are also formulated as ratios rather than differences
Cost Performance Index (CPI) = EV/AC
Schedule Performance Index (SPI) = EV/PV
Time Performance Index (TPI) = ST/AT
Use of ratios is particularly helpful when comparing the performance of several projects

34. Milestone Reporting
Milestone reports serve to keep all parties up to date on what has been accomplished
If accomplishments are inadequate or late, these reports serve as starting points for remedial planning

35. Computerized PMIS
New PC or workstation-based project management information systems (PMISs) are considerably more sophisticated than earlier systems
Uses computer graphics, color, and other features more extensively
Many systems can handle almost any size project, being limited only by the memory available in the computer

36. Computerized PMIS
The PMIS trend of the 1990s has been to integrate the project management software with spreadsheets, databases, word processors, communication, graphics, and the other capabilities of Windows-based software packages
The current trend is to facilitate the global sharing of project information, including complete status reporting, through local networks as well as the Internet

37. Current Software
The explosive growth of project management software during the early 1990s saw the creation of more than 500 packages
Systems can be easily misused or inappropriately applied - as can any tools
The most common error is managing the PMIS rather than the project itself

38. Current Software
In addition to managing the PMIS instead of the project, other problems include:
Computer paralysis
PMIS verification
Information overload
Project isolation
Computer dependence
PMIS misdirection

39. Choosing Software
Characteristics of generally desirable attributes in project management software:
Friendliness
Schedules
Calendars
Budgets
Reports
Graphics
Charts
Migration

40. Typical Software Output

41. Typical Software Output
Early and late start and finish dates and slack

42. Typical Software Output
Project Cost Tracking

43. Typical Software Output
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