by Okitanye Gaogane
If you own one of those sophisticated cars with fancy dashboards, then you have project management analytics right in front of you.
We have all experienced that orange tank. Are you one of those drivers that take heed of the sign and get to the nearest petrol station to refuel, or do you let the car come to a stop first, call a cab, buy a container and go and buy extra fuel? The car operates off of resources and the dashboard acts in an advisory capacity. Taking heed of the warning indicators on the dashboard is metaphorically what Project Controls is.
Now here is a classic office case that explains project performance, project analytics and simplifies earned value management. Our office has an 80L capacity petrol tank car and when you drive at normal speed doing 12km/L the fuel will cover 960km. Gaborone-Kasane is 924km, so if we send a consultant on a Kasane mission on a full tank we have a nice contingency of an extra 36km.
I have a colleague, who shall remain anonymous in this article lest the law enforcement officers start following him. If I give him this car, by the time he is halfway to the destination, the fancy dashboard will be reading Distance To Empty DTE: 100KM. If he ignores this he will not even make it to Nata.
How does this relate to project management? This consultant I am referring to, the only thing that matters to him is time. He breaks traffic (project management) rules and is very wasteful in terms of resources (petrol) because to him the most important thing is Time; not necessarily a bad priority. We have seen this in a number of projects, haven’t we? His argument is that there is quality in the ride, and I say he is a risky and wasteful fellow in many ways.
Back to earned value. What is earned value?
Englert and Associates, Inc. define it as, a method for measuring project performance. It compares the amount of work that was planned with what was actually accomplished to determine if cost and schedule performance is as planned.
In our scenario, the plan was to have used 462km worth of fuel (P293) this is referred to as earned value. The dashboard says we have used 860km worth of fuel (P545), this is called actual performance. Our cost performance index says that for every 53 km traveled we are spending 100 km worth of fuel. This does not take a genius to figure out that to arrive in Kasane at the same speed we need and estimate to completion of twice the original budget. The beauty of analytics is that you now have to make informed decisions on whether you will do a budget change request and continue at the same driving behavior or sacrifice speed for resource conservation.
Cutting the story short, if you are leading the project and you have no way of reporting current performance and extrapolating future performance, then you are as good as driving a car without a dashboard. You will get a lovely surprise when the car stops in the middle of nowhere. At a national level, I can only hope that future projects have at a bare minimum cost controllers, schedule controllers, planners, and risk managers to manage the MEGA Pula project analytics. This is business, we need to EARN VALUE for every taxpayer-PULA spent.
Okitanye Gaogane holds the position of Academy Manager at InnoLead Consulting offering Management Consultancy and Corporate Training Solutions. He can be contacted on +267 3909102 and firstname.lastname@example.org.