The most successful method of "project controls" is Earned Value Management (EVM). There are 32 criteria for a fully compliance Earned Value System in the government contracting world. But these 32 criteria are not needed for success when applying Earned Value outside a formal contracting environment. For government contracts greater than $20M (that is pretty low in the government world), EV can be just as effective without all the formality.
Here's the 10 activities you need.
Let's look at each one and pretend we're not speaking about Earned Value, just good project management performance measurement activities. And let's look at these from a general product development point of view. From Scrum to a PMBOK process group and knowledge area.
Here are the numbered items from the 32 Criteria that should be present in any project performance management system independent from calling it Earned Value. This list has been worked on on the LinkedIn Earned Value item, led by Wayne Abba and other colleagues.
Mr. Abba led the EVM initiatives during his public service career in the Department of Defense and continues to lead through his membership in the National Defense Industrial Association and the Project Management Institute’s College of Performance Management.
- 1. Define authorized work elements - we need to know what work we are authorized to do. It's the customer's money and we must spend it wisely. This can be a pile of sticky notes on the wall, that are moved from one column to another in the agreed order. Or it can be a full blown Integrated Master Schedule, with Work Packages authorized to be released for execution.
- 2. Identify project organizational structure - who's doing what during the execution of the project?
- 5. Provide integrated planning, scheduling, budgeting, work authorization, and cost accumulation processes - you got to keep all the moving parts connected in some way.
- 6. Schedule the authorized work in a sequential manner that identifies the significant task dependencies - if I do work out of order is confuses people. This is the fundamental principle of "value flow." Do the work in the order that creates the highest value to the project, business, or user.
- 7. Identify physical products and organizations - show me what you're building by building it and showing me the outcomes. The physical, tangible evidence that you did what you said you were going to do.
- 8. Establish and maintain time–phased budget baseline - who's paying for this? How much money do we need next week to keep working? How much is this going to cost when we're done? Is there enough in the bank to complete the project. Questions like this and their answers are asked on any project.
- 16. Record direct costs consistently in a formal manner - even if we're spending at a fixed rate (level of effort), we need to know the rate at which we're spending.
- 23. Periodically generate project metrics - stop, take a break, look at the progress that has been made. Is it at a rate that we'll be happy with? Is it at a rate that will get us to the end at the expected time?
- 25. Develop revised cost estimates–at–completion based on performance to date - if not, then what is the rate we need to run at to get there on time? If we can't change that, what time well we be done? What will it cost when we're done?
- 28. Incorporate authorized changes in a timely manner- when we revise all this information, keep track of these revisions, so we aren't confused in the end when someone asked "why is this different from what I thought is was?"
