Project Monitoring

Hello everyone! I'm sorry it has been so long since my last post. I have been going through a job change, and the last month has been hectic with getting things shored up at my previous company and (trying) to get up to speed at the new company. I recently listened to my favorite podcast, The PM Podcast, and episode 75 is about project monitoring.

I really enjoyed this episode. Upkeep during project execution and finding problems as early as possible has always been an important topic for me. I think that is why I found interest early in the Critical Chain methodology, because it offers great ways to highlight and pinpoint problems early on. In particular, I felt the soft skills addressed in the discussion were very important. After all, you can have mountains of data, but if you don't know how to present it well or what to do with it, it has no value. My key interests are being able to take quantitative data from something like EVM and combine it with qualitative data in order to target specific work packages, resources, or stakeholders who are having/causing issues.

I will let you listen to the podcast, but it was wonderful. Also check out the accompanying power point presentation here.

Itchy for Earned Value

When I originally started this blog, it was because I wanted to explore ways of making Earned Value Management (EVM) work with Critical Chain project management. I still believe that is a worthwhile goal. I have been doing a lot of brushing up on EVM lately, and am ready to dig in again. Since I am already very familiar with the theory behind Critical Chain and buffer management, I am going to focus on EVM for awhile and then try to meld Simple EVM in the terms described by Joel Koppleman and Quentin Flemming to Critical Chain.

Why EVM?

EVM at it's core is a way to measure performance in terms of cost, schedule, and technical performance. One of the key benefits I have heard cited regularly is that with EVM, you can tell early on whether or not a project is at risk. Quentin Flemming said in an interview on The PM Podcast that there is strong evidence that poor EVM performance at the 20% done mark in a project is very unlikely to be made up unless more resources are added, more funds are appropriated, or the scope gets trimmed.

Another benefit of EVM is objectivity. It measures performance compared with an original baseline schedule and budget. The performance indexes in EVM allow comparisons between projects even when their actual budgets and schedules are very different. You can compare a 6 month project to a 6 year project in the same terms. Because of the objective and universal measure, it also can help make project performance visible to all levels of stakeholders.

Why Not EVM?

There are a few criticisms of EVM I have heard that I would like to discuss. First, full-blown EVM is simply too much overhead for small projects. Simple EVM was introduced for this very reason, and I believe it could be a suitable replacement for smaller projects.

Another thing to keep in mind is that EVM does not take the critical path into consideration. It treats all work equally, which works really well for cost performance but not so well for schedule performance. At first blush, it seems to me that in addition to the SPI (schedule performance index) which I will detail in later posts, there should be an index that tracks progress along the critical path. This could be done by simply tracking schedule performance on the critical path against the original baseline. In this way, the SPI relates more to the amount of work done than the timeliness of the project. They are different but related ways of looking at project schedule performance.

Up Next: EVM Basics

Risk Attitudes

I listened to Cornelius Fichtner's new PM Podcast episode today, How do risk attitudes affect your project?

As usual, Cornelius provides great content in this episode. The interview with Janice Preston was very insightful and helped me with the concept of risk management. In school, they teach you that risk management is almost like it's own little module that you do while planning and insert into the project plan. Sometimes they talk about updating and reviewing it regularly. I've never heard them talk about it in the context of the risk attitudes of project stakeholders.

You really need to listen to this episode if you haven't already, but one aspect I liked was the classification of 4 distinct risk attitudes:

1. Risk Seeker - enjoys and seeks uncertainty in search of greater opportunities, can be overly optimistic and not take possible negative consequences seriously.
   
2. Risk Averse - uncomfortable with uncertainty, doesn't like risk
   
3. Risk Tolerant - reasonably comfortable with uncertainty, but usually sticks head in the sand and ignores them
   
4. Risk Neutral - analyzes risks and weighs negative/positive possible outcomes and probabilities objectively.
   

From my experiences with project managers, it appears to me that the majority are Risk Tolerant. I say that based on how little time and effort is usually put into analyzing and planning for risks. I can also identify with these classifications because of people I've worked with on project teams. Some people seem to have their heads in the clouds and look for risky solutions when a more proven approach would do (Risk Seeker), and others are conservative to the point of seeming cynical (Risk Averse).

Risk Neutral is the goal. Personally, I'd say I'm more of a Risk Seeker right now, but the knowledge and experience I'm gaining are directing me more towards the direction of Risk Neutral. The tools and techniques of risk management are doing that for me by forcing me to look at uncertainty in more of a formal SWOT analysis where my exuberant optimism can be subjected to some logical scrutiny.

Be sure you head over to The Project Management Podcast and check out this episode.

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