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EVM and Agile – Project Reporting

Context

This post was modified from one I developed several years ago for the Mercure AACE 2013 program I took, called W17_PM_EVM-KPI-Reporting. It is a follow on to a recent post “EVM and Agile – Can they work together?“.  Once again, this post is not specifically about sustainable change delivery. It does provide useful considerations, tools and techniques for consideration though for project controls in sustainable projects.

The original inspiration for this post came from an AACE paper from 1994 and the following two graphics 1.

The first graphic demonstrates findings from the mid 90s of a questionnaire distributed to 35 professionals within a large engineering firm demonstrating their understanding of key cost engineering skills. If the results were this poor for a Professional Engineering organization, one can easily imagine what it would be for non-engineering or executives untrained in cost engineering skills.

W16-CostingKnowledge

Graphic 1: Survey Data: Staff Knowledge of Key Cost Engineering Concepts (Modified slightly by Author)

The second graphic is a recommendation for what and how to present project information to the project sponsor and/or executive. The benefit is that it provides a clear snapshot on the issues that matter most to the executive, and it shows trends. All of this information can be derived directly from the EVMS reports.

W16-ExecReport

Graphic 2: Project Summary Status (Modified slightly by Author)

These sources highlight a need to ensure the Earned Value analysis and reporting is communicated in an appropriate manner for the Project Sponsor and executive.

There are several assumptions being put forward:

  1. The focus will be on IT Enabled Solutions engagements
  2. The change initiative is not of a sustaining or transformational nature (please see Table 1 below)
  3. The Project Sponsor is not familiar with project management (i.e. Agile or Earned Value)
  4. There is a sound business case with quantifiable costs and benefits documented
  5. The organization has the resource capacity and competency; along with organizational maturity (i.e. Level 2 or higher) to employ Agile and Earned Value methods, tools and techniques (please see Graphic 3 below)
  6. The governance structure is of an owner organization, focusing on the means to an end where the primary benefit of a project is achieving or realizing the benefit from the product of the project (i.e. what the project was undertaken to create or change). In most owner organizations the Project Manager does NOT have the formal authority commensurate with their responsibility. This impacts the dynamic between the project manager and the organization and the project manager and the project sponsor.

W16-ProjectComplexity

Table 1: Project Complexity and Risk Level Definitions (Modified by Author) 2

W16-BMP

Graphic 3: Key Business Management Practices Operational 3

Problem Statement

Is it possible to improve project management reporting, management analysis and decision support by employing EVM, Excel and Agile in a cost effective and efficient manner?

W17-Dilbert-A

Graphic 4: Dilbert 10/03/2010 4

Development of Feasible Alternatives

There are three possible alternatives:

  1. Demonstrating that employing EVM, Excel and Agile can improve PM reporting, management analysis and decision support in a cost effective and efficient manner.
  2. Proving why employing EVM, Excel and Agile cannot improve PM reporting, management analysis and decision support or it would be to expensive and inefficient to provide value.
  3. Something else.

Development of the Outcomes of Each Alternative

W17-AlternativeOutcomes

Table 2: Outcome Alternatives (Table supplemented from Sullivan et al for the Author’s purposes) 5

Selection of the Acceptable Criteria

For the purposes of this paper, the acceptable criteria will be defined as:

W17-AcceptanceCriteria

Table 3: Acceptance Criteria (Author’s design) 6

Analysis and Comparison of the Alternatives

Background

The following was also taken from the introduction of the 1994 Arthur Hadnett presentation setting the stage for why improved reporting is key 7:

W17-JustificationReporting

The following was also taken from the summary of the 1994 Arthur Hadnett presentation recommending some changes in how we should conduct our business 8:

W17-RecommendationReporting

It is curious how for well over a decade things have not progressed that much.

W17-AgileEVMReview

W17-AgileEVMAlternative

W17-AgileEVMRecommendedReportGraph

W17-AgileEVMPerspective

Project Controls Environment

During the following process, conversations and reporting with the project sponsor and executive will be taking place using the “management by exception” approach. For the purposes of this paper we will focus on the status report for the project sponsor and executive highlighted by the red box:

W17-HumphreyProcess02

As demonstrated by the following, much of the EVM analysis and reporting can take place in MS Excel:

W17-EVMProjectDataFlow

Preparation

The following section is not for the project sponsor or executive. However, it provides the analysis, traceability and confidence to properly present clear and concise recommendations for the project.

The traditional Contract Performance Report (CPR) for EVM is outlined below:

W17-Preparation01

The beauty of EVM is that it allows a deep and methodical analysis of the current state of the project:

W17-Preparation02

A recommended process is outlined below 14:

W17-Preparation03

For example, the current status indicators are important:

W17-Preparation04

The issue is that once a project initiates it seldom goes according to plan:

W17-Preparation05

Using the plan and actuals to identify variances:

W17-Preparation06

And resolving the following questions:

W17-Preparation07

A process similar to the following can help with variance analysis:

W17-Preparation08

The following performance forecasting is useful:

W17-Preparation09

The following future performance forecasting is also useful:

W17-Preparation10

The standard EVM reporting chart looks like the following:

W17-Preparation11

Which for the project sponsors and executives outlined in the assumptions, would not be understandable:

W17-SimpleReport

Recommendation

Every project has different stakeholders, organizational maturity, support systems and nature of the engagement. KPIs and reporting will have to be agreed at the beginning of each project and will evolve throughout.  One recommendation is a project status report called a “project quad” divided into four intuitive sections that provide an executive summary level of information.

I. Project Overview: This section provides project charter level information on the quantifiable business objectives, work authorization date, approved capital budget, and the standard project health indicator (now less subjective).

W16-ExecReport

W17-SimpleReportRecommendations

II. Current State: This section provides a quick reference for project progress according to plan. The variances are immediately obvious and frequently initiate the discussion necessary to remove barriers to progress. There are advantages to the simpler wording and demonstration of project status on the EVM/Agile type graph below.

W17-RecommendedReportGraph

III. Risks and Issues: The project manager uses this section to provide bulletized statements about barriers to either progress or meeting the approved business objectives.

IV. Next Steps: This section is used to either identify the next milestones or for recommendations to bring performance back in line with the plan.

Analysis

W17-FinalAcceptanceCriteria

Based on this and the previous several posts this grid was filled out.

Selection of the Preferred Alternative

Based on this analysis, Option 1 “Demonstrating that employing EVM, Excel and Agile can improve PM reporting, management analysis and decision support in a cost effective and efficient manner” appears to be the proven and the preferred alternative, based on the assumptions.  Though project is different EVM, Agile and Excel should all be aggressively considered as useful tools and approaches.

What has this to do with sustainable project management?

It obviously depends on the type of project, industry, culture and maturity / competency of the project team, but I have found this support structure and reporting technique to be extremely beneficial for sustainable projects. Once again just a few more tools and techniques for the tool kit.

References

  1. Hadnett, Arthur (1994). Cost Engineering: Making it Work. [ONLINE] Available at: http://www.aacei.org/avectramembers/pdfs/18010.pdf. [Last Accessed 15 April 2013].
  2. TBS (2013). Project Complexity and Risk Assessment Tool v1.4. [ONLINE] Available at: http://www.tbs-sct.gc.ca/pm-gp/doc/pcra-ecrp/pcra-ecrp-eng.asp. [Last Accessed 5 May 2013].
  3. Alleman, Glen (2011). NDIA Information Systems Summit II – Earned Value + Agile = Success. [ONLINE] Available at: http://www.slideshare.net/galleman/evagilesuccess-final-v2. [Last Accessed 2 April 2013].
  4. Adams, Scott (2010). 10/03/2010. [ONLINE] Available at: http://dilbert.com/strips/comic/2010-10-03/. [Last Accessed 12 May 2013].
  5. Sullivan, W.G., Wicks, E. M., & Koelling, C. P. (2011). Engineering Economy, pp. 7 – 15, 15th edition, Prentice Hall
  6. Humphreys, Gary (2010). EVMS The Principles, Best Practices and Benefits. [ONLINE] Available at: http://www.slideshare.net/NASAPMC/humphreysgary. [Last Accessed 20 February 2013].
  7. Ibid Hadnett
  8. Ibid
  9. Griffiths, Mike (2008). A Better S Curve and Simplified EVM. [ONLINE] Available at: http://leadinganswers.typepad.com/leading_answers/2008/06/a-better-s-curve-and-simplified-evm.html. [Last Accessed 5 March 2013].
  10. Ibid Humphreys
  11. Ibid
  12. Ibid
  13. Ibid
  14. Ibid
  15. Ibid
  16. Ibid
  17. Ibid
  18. Ibid
  19. Ibid
  20. Ibid
  21. Ibid
  22. Ibid
  23. Ibid Hadnett
  24. Kerzner, Harold (2011-07-15). Project Management Metrics, KPIs, and Dashboards: A Guide to Measuring and Monitoring Project Performance. Wiley Publishing. Kindle Edition.
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Peter Milsom

Peter Milsom is an entrepreneurial advocate for sensible, sustainable change delivery practice. Peter has come to realize that sustainability is the perfect catalyst for Project / Programme / Portfolio / Risk / Value / Business Case and Benefits Management improvement.

As an entrepreneurial methodologist Peter’s unique value proposition is the vast array of tools and techniques that he brings to every engagement using the most cost effective and efficient methods based on the situation and tailored to meet your needs. This is based on his unique combination of experience and extensive training / certifications in change delivery, value / risk / benefits management business case, and business architecture.

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