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Chapter 10

Monitoring and
Information
Systems

Project Planning and Control System

Planning activities

Monitoring activities

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Terms

 Monitoring - Collecting, recording, and

reporting information concerning any and
all aspects of project performance
 Controlling - Uses the data supplied by
monitoring to bring actual performance
into compliance with the plan
 Evaluation - Judgments regarding the
quality and effectiveness of project
performance

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The Planning–Monitoring–Controlling
Cycle

 We mainly want to monitor:

– Time (schedule)
– Cost (budget)
– Scope (project performance)
 Closed-loop system
– Revised plans and schedules following
corrective actions

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Project Authorization and Expenditure

Control System Information Flow

Figure 10-1 10-5

Designing the Monitoring System

 Identify key factors to be controlled

– Scope
– Cost
– Time
 Information to be collected must be
identified

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Designing the Monitoring System

Continued

 Do not want to avoid collecting necessary

data because it is hard to get
 Do not want to collect too much data
 The next step is to design a reporting
system that gets the data to the proper
people in a timely and understandable
manner

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Data Collection

 Once we know the data we want, we

need to decide how to collect it
 Should the data be collected after some
event?
 Should it be collected on a regular basis?
 Are there any special forms needed for
data collection?

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Much Data Involves

 Frequency counts
 Raw numbers: Hours, dollars, dates…
 Subjective numeric ratings
 Indicators: Indirect measures
 Verbal measures: quality, moral…

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Information Needs and Reporting

 Everyone should be tied into the reporting

system
 Reports should address each level
 Not at same depth and frequency for
every level
– Lower-level needs detailed information
– Senior management levels need overview
reports
 Report frequency is typically high at low
levels and less frequent at higher levels
 Report’s structure reflects the WBS
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The Reporting Process

 Reports must contain relevant data

 Must be issued frequently
 Should be available in time for control
 Distribution of project reports depends on
interest
– For senior management, may be few
milestones
– For project manager, there may be many
critical points

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Benefits of Detailed and Timely Reports

 Mutual understanding of the goals

 Awareness of the progress of parallel
activities
 Understanding the relationship of tasks
 Early warning signals of problems
 Minimizing the confusion
 Higher visibility to top management
 Keeping client up to date
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Report Types

 Routine - Reports that are issued on a regular

basis or each time the project reaches a
milestone
 Exception - Reports that are generated when
an usual condition occurs or as an
informational vehicle when an unusual
decision is made
 Special Analysis - Reports that result from
studies commissioned to look into unexpected
problems

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Meetings

 Important tool for disseminating

information and making decision
 Clear purpose for each meeting
 Reports do not have to be written
 They can be delivered verbally in meetings
 Projects have too many meetings
 The trick is to keep them to as few as
possible
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Meeting Rules
 Use meetings to make group decisions
 Start and end on time and have an
agenda
 Do your homework before the meeting
 Take minutes
 Avoid attributing remarks to individuals in
minutes
 Avoid overly formal rules of procedure
 Call meeting for serious problems
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Common Reporting Problems

 Too much detail for intended purpose

 Poor interface between the
data/procedures of the project and the
information system of the parent
company
 Poor correspondence between the
planning process and the monitoring
process

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Earned Value Analysis

 A valuable technique for monitoring overall

project performance
 Have covered monitoring parts
– Timing and coordination between individual
tasks is important
 Must also monitor performance of entire
project
– Crux of matter should not be overlooked
 One way is by using an aggregate
performance measure called earned value
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The Earned Value Chart and

Calculations

 Actual against baseline ignores the

amount of work accomplished
 Earned value incorporates work
accomplished
 Multiply the estimated percent work
complete for each task by the planned
cost
 Only need percent complete estimate for
tasks currently in progress
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Rules to Aid in Estimating Percent

Completion

 50-50 rule
 0-100 percent rule
 Critical input use rule
 Proportionality rule

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The Earned Value Chart

CV
SV

TV

Figure 10-6 10-20

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Variances

 Variances can help analyze a project

1. A negative variance is bad
2. Cost and schedule variances are calculated
as the earned value minus some other
measure
 Will look at some of the more common
ones

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Glossary of Terms

 EV (Earned Value)
The percent of the original budget that has been earned by actual
work completed.
(BCWP—Budgeted Cost of the Work Performed)
 PV (Planned Value)
The cost of work we scheduled to be performed to date
(BCWS—Budgeted Cost of the Work Scheduled).
 AC (Actual Cost)
The actual cost of the work completed.
(ACWP—Actual Cost of the Work Performed).

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Variance Analysis
 CV (Cost Variance)
The difference between the earned value EV and the actual costs
for the work completed to date, CV = EV-AC.
CV = BCWP – ACWP (CV <0: Cost overrun)
 SV (Schedule Variance)
The difference between the earned value EV and the cost of work
we scheduled to be perform to date, SV = EV-PV.
SV = BCWP – BCWS (SV<0: behind schedule)
 TV (Time Variance)
The difference in the time scheduled for the work that has been
performed ST and the actual time used to perform it AT, TV=ST-AT
TV <0: delay/ behind schedule

Glossary of Terms

 BAC
– Budgeted cost at completion. The total budgeted cost of the
baseline or project cost accounts.
 EAC
– Estimated cost at completion. Includes costs to-date plus
revised estimated costs for the work remaining.
 ETC
– Estimate cost to complete.

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Earned Value (Cost/Schedule) Chart

Earned Value Chart Review

Overrun - behind Overrun - ahead

In budget - ahead In budget - behind

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Indices

 CPI- Cost Performance Index

CPI = EV/AC (CPI<1: Cost overrun)
 SPI- Schedule Performance Index
SPI = EV/PV (SPI<1: Behind schedule)
 TPI- Time Performance Index
TPI = ST/AT (TPI<1: Behind schedule)
 CSI- Cost Schedule Index
CSI = EV2/(AC)(PV) (CSI<1: Problem)
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“To complete” and “At Completion”

 Project manager reviewing what is

complete and what remains
 Final cost and final completion date are
moving targets
 The project manager compiles these into
a to complete forecast
 Actual + forecast = final date and cost at
completion
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ETC and EAC

• ETC- Estimated cost to complete

ETC = (BAC + EV)/CPI
• EAC- Estimated cost at completion
EAC = ETC + AC
where,
BAC = Budget at completion
EV = Earned value
CPI = Cost performance index
AC = Amount expended to date (actual cost)
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ESTIMATE AT COMPLETION (EAC)

EAC = ACWP X Budget at completion

BCWP
(BAC)

• 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.

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Milestone Reporting

 Reports that are created when a project

reaches a major milestone
 They are designed to keep everyone up-
to-date on project status
 For executives and clients, these may be
the only reports they receive

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Milestone Reporting

MILESTONE REPORT

Milestone/ Scheduled Projected Actual

Subtask Completion Completion Completion
1 4/1/97 4/1/97
2 5/1/97 5/1/97
3 5/1/97 4/23/97
4 7/1/97 7/1/97
5 6/1/97 6/1/97
6 8/1/97 8/1/97
7 9/1/97 9/1/97
8 10/1/97 10/1/97
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Computerized PMIS (Project

Management Information Systems)

 Real projects are often large

– Hundreds of tasks
– Thousands of work units
 Reporting is clearly a job for the computer
 Project management information systems
were one of the earlier applications
 Initially focus was on scheduling
 Now it includes, earned values,
variances, and more
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PMIS Errors

 Managing the PMIS

 Computer paralysis
 PMIS verification
 Information overload
 Project isolation
 Computer dependence
 PMIS misdirection

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PMIS Desirable Attributes

 Friendliness  Graphics
 Schedules  Charts
 Calendars  Migration
 Budgets  Consolidation
 Reports  Access

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Questions?

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