Create Robust Project Plans
Earned Value Management is a contract requirement for many organizations working with government agencies and on large projects – even if your part in the project is actually quite small. Perhaps your firm is responsible for some electrical installation or providing a specialist service to the main contractor. You’ll still need to meet all the requirements for operating in that kind of environment, even if you aren’t responsible for the overall project’s success.
There are lots of benefits to using EVM on projects, and the technique is well-known for the benefit of project performance management. But there’s one big challenge for teams: you need to have robust project plans before you start to see any of the benefits from Earned Value Management. But what do ‘robust project plans’ actually look like? Let’s dive into the four characteristics your project schedules should have to make EVM effective for you and your clients.
1. A Work Breakdown Structure
The project plan should include a decomposed view of all the work in a WBS. That should take into account the level of uncertainty for each of the tasks, the risk associated with the activity, a description of how progress will be measured and information about who is owning the work.
We have lots of resources to support you in creating a WBS in Primavera P6 Professional or Primavera EPPM available on our website or you can learn more about our training courses to help guide your team in how to do this part properly. The video below, for example, shows how to modify the WBS in Primavera P6.
2. Estimates
Your plan should include detailed (and realistic) estimates that accurately reflect the cost, duration and effort for each activity. This is important because you need to be able to track progress against something, and your estimates form the basis of that tracking. As the project progresses, you will compare actual performance against estimated performance and see how the project is going. From that information, the team can decide what to do next: perhaps more resources are needed to hit the deadlines, or perhaps an assumption proves to be incorrect so the team has to replan.
Estimates form the basis of your project schedule, which is the next thing you need for a successful implementation of EVM.
3. Scheduling
When people talk about a project plan, they often mean the timeline for the tasks, but one thing EVM teaches you to do properly is to separate ‘plan’ and ‘schedule’. Plans cover the whole approach for how the work will be carried out. The schedule is the part that includes a list of activities and dates – your classic Gantt chart, or however else you decide to monitor and track the work. In an EVM environment, a Gantt chart works well because it aligns with the expectations for being able to control the work, but you may find other solutions for scheduling are effective in specific situations.
Scheduling, however, is more than a list of task names and dates. It should also include the resources required to do the tasks, whether that is people or the scheduled availability of other types of resources. The schedule should reflect budget over time, which is a measure of how much the work costs. Many scheduling tools, including the ones we work with often like Primavera P6 Professional, enable you to track financial information alongside work completed.
4. Subcontracted information
The WBS, estimates and the schedule are the main requirements for any project using EVM. However, if your project also includes elements that are subcontracted to other suppliers, your plan needs to take those into consideration too.
When working with subcontractors, take into account:
- Creating a detailed scope definition to cover the portion of work for which they are responsible
- Co-creating a schedule with them so that the work dovetails neatly into your other tasks, with no waiting periods or downtime on either side
- Gaining a full understanding of the budget costs to be incurred by their work.
Poor control and oversight of subcontractor work is one of the reasons that projects take longer and cost more, or fail to deliver all the scope elements within the expected time constraints. For example, in the UK, the National Audit Office’s report into lessons learned from major projects highlighted the delays to the delivery of the Crowsnest radar system on the Carrier Strike project which were due to delays on the part of a subcontractor. The delays were not identified by the UK Government department responsible for the project or the main contractor until it was too late to meet the expected delivery date.
When all parties involved in the project work together, it’s easier to achieve the desired outcome, which is why it’s so important that upfront all the plan and schedule details are created from the position of having as much information as possible. From there, you can use EVM techniques to monitor and control the whole work, ensuring there is a highly likelihood of success for completing the work.
The trouble with implementing EVM when you do not have robust project plans is that the results from the EVM reporting are not helpful. They don’t reflect the reality of project performance and they don’t give the project team what they need in order to be able to achieve the goals. The risk then is that the project is deemed not suitable for the EVM way of working, when that is unlikely to be the case.
We know it’s hard to spend so much time on creating robust plans if that isn’t your core skill set and that’s why we offer bespoke scheduling services. We can provide everything from a complete set up of your plan, maintaining and updating it during the project, or helping augment your team with expert schedulers to support the work. That frees you up to do what you do best: working with your client to deliver an excellent result, confident in the knowledge that your schedules meet the contract requirements and you have an experienced team sharing the overhead. If that sounds like something that would save your team some time, give us a call!