Earned Value, Courting the Law

Jarndyce and Jarndyce drones on. This scarecrow of a suit has, in course of time, become so complicated that no man alive knows what it means. The parties to it understand it least, but it has been observed that no two Chancery lawyers can talk about it for five minutes without coming to a total disagreement as to all the premises. From the first chapter in the novel Bleak House by Charles Dickens. Jarndyce and Jarndyce is a fictional court case in Chancery but there is another court case that almost fits Dickens’ morbid description………

The A-12 “Avenger II” was to be a carrier-based stealth attack aircraft for the US Navy that has been in the courts since 1991. The plaintiffs (McDonnell Douglas and General Dynamics – since acquired by Boeing and Lockheed Martin respectively) sued for relief after the Navy terminated the A-12 development contract for default.

Based on the contractor’s Earned Value analysis that showed ‘catastrophic’ cost and schedule problems on this complex, multi-billion $ fixed price incentive contract, the then Sec. of Defense Dick Cheney withdrew his support for the program.

Wayne Abba was selected by the Department of Justice/Navy litigation team as a fact witness who could have an opinion about the EVM data because he had not been involved in the Government’s decision making process. Wayne testified in the 5th trial after the appellate court agreed with the government that performance (or lack thereof) was indeed an issue. His testimony helped set the stage for a reversal by the trial judge from his prior 4 decisions – a reversal that has been upheld by appellate courts since, most recently in June 2009; with further pleadings this month.

As Dickens continued…. Scores of persons have deliriously found themselves made parties in Jarndyce and Jarndyce without knowing how or why…… Fair wards of court have faded into mothers and grandmothers; a long procession of Chancellors has come in and gone out; the legion of bills in the suit have been transformed into mere bills of mortality; …… but Jarndyce and Jarndyce still drags its dreary length before the court, perennially hopeless.

This is an important decision for anyone involved in the proactive management of projects. If the US Governments position holds, reliable predictive data that clearly shows a ‘catastrophe’ in the making will allow project owners to take pre-emptive steps to protect their position. If the plaintiff contractors eventually prevail, the only safe option for owners will be to wait for the train wreck then try to pick up the pieces.

Hopefully we won’t have to wait another 18 years for an answer……….

Advances in Project Schedule Management

In 2007/2008, the Chartered Institute of Building (CIOB) undertook a survey of the state of time management in the UK construction industry. The findings painted a dismal picture of the current state of planning and scheduling with low usage of CPM schedules, minimal updating and almost no proactive forward management (download report summary). On a more general basis, the construction and engineering industries were at the forefront of effective time management through the 1960s, 70s and 80s (along with defense industries) which would suggest other areas of business management such as IT are unlikely to be better situated.

Based on these findings, the CIOB believes that it is essential to educate both project planners and schedulers in construction time management best practice with an aim to reduce the incidence of delayed completion on construction projects. To achieve this, the CIOB have adopted a three-phase strategy to provide the required standards of performance in effective time control:

• Phase 1
  The education training and accreditation of project schedulers, including:
  • The development of a ‘Guide to Good Practice in Project Programming and Scheduling’.
  • The production of an educational framework for current and future project schedulers.
  • The accreditation of qualifications in time management.
  • The dissemination of the Guide to other professions in the industry.
• Phase 2
  The promotion of amendments to standard forms of contract to facilitate effective time management.
• Phase 3
  The education training and accreditation of project planners.

Download the CIOB’s policy Statement.

Phase 1.1, the development of the Guide, is nearing completion. The provisional draft of the Guide is nearly ready for public comment and feedback.

I have had the privilege to be part of the team working on the development of the Guide and believe it is a major advance on anything currently available. Whilst focused on construction/engineering, the skills of effective planning and scheduling are highly transferable. Consequently, when published, the guide will be a valuable resource for PMO Managers and schedulers in most industries.

More information shortly……

Schedule Float

Scheduling has lost a lot of float in the last few years! And arguably the practice of scheduling is sinking…..

Are the two phenomena connected? Is this a total disaster or largely irrelevant??

As part of my research for the new CIOB scheduling guide, I have been digging through some old books and resources from the 1960s and 70s. 40 years ago, float was a far more sophisticated concept compared to today but how significant is this loss of insight?

You are invited to read the discussion paper ‘Schedule Float’ and then comment on this blog.

The Effective Management of Time in Complicated Construction Projects

The CIOB is finalising the publication of ‘The Guide to Good Practice in the Effective Management of Time in Complex Construction Projects’ with a public consultation period planned before Christmas leading to publication in 2010.

The primary purpose of this Guide is to set down the standards of project scheduling necessary to facilitate the effective and competent management of time in construction projects by defining the standard by which project schedules will be prepared, quality controlled, updated, reviewed and revised in practice.

Before embarking on the guide, the CIOB conducted a survey between December 2007 and January 2008 of the state of time management in a range of UK construction projects. The outcome of the survey was surprising. On simple construction projects, the range of outcomes (late, on time, early) were more or less the same regardless of the use or non-use of effective time management processes.

However, as the projects became more complicated, the difference between projects with an effective time management system and those without became significantly more noticeable. Projects with a well defined time management system were far more successful than those without!

The definition of simple and complicated derived from this study is:

• Simple Projects comprise those in which construction has the following characteristics:
  • design work is completed before construction starts;
  • single building or repetition of identical buildings;
  • less than 5 stories high;
  • without below-ground accommodation;
  • carried out to a single completion date;
  • without phased possessions or access;
  • with services not exceeding single voltage power, lighting, telephone, hot and cold water and heating;
  • a construction period of less than 9 months;
  • with a single contractor; and
  • with less than 10 sub-contracts.
• Complex Projects comprise those in which construction comprises, one or more of the following characteristics:
  • design work is to be completed during construction
  • more than one building
  • more than 5 stories high
  • with below-ground accommodation
  • with multiple key dates and/or sectional completion dates
  • with multiple possessions or access dates
  • with short possessions
  • with services exceeding single voltage power, lighting, telephone, hot and cold water and heating.
  • accompanied by work of civil engineering character
  • a construction period greater than 12 months
  • with multiple contractors
  • with more than 20 sub-contracts

This opens the question why? I would suggest the likely answer, transferable to any project and any industry, is in two parts; both related to stakeholders and communication.

The initial benefit of the process of developing the schedule on a complicated project is the insights the act of creating the schedule gives to the project management team. It is impossible to effectively communicate to the project team and other stakeholders what has to be done when if the project management group don’t have a very clear idea themselves.

‘Simple projects’ are small enough and routine enough to be mapped out in an experienced managers mind. The person intuitively knows what needs to be done. As the project becomes more complex the analysis and serial decision making inherent in the schedule development process creates insights, new information and allows the testing hypothesis until an acceptable solution is devised. At the end of the planning process, a way forward has been determined, optimised and agreed.

The greater benefit though is likely to be in the area of coordination and communication during the work of the project. No schedule is ever perfectly correct. But having an agreed schedule that everyone works towards achieving minimises coordination issues and as elements of the work occur out of alignment with the schedule, the schedule and the variance information provide the foundation for proactive discussion and decision making.

A final intangible benefit of having a schedule has been identified in new research by Jon Whitty. It would appear that simply having a schedule is important for the credibility of the project manager. The project manager’s managers expect the PM to have a schedule and consequently give more credibility to communications from the PM if the schedule is present.

The challenge facing both PMs and their managers as a consequence of these findings is to determine for their industry the difference between simple projects where minimal systems are needed and complicated project where not having a reasonably sophisticated system to help manage time, and other elements of the project, is a distinct liability.

It would seem size does matter! And the old saying ‘if you fail to plan, you plan to fail’ really only applies to the larger more complicated projects. 

Mosaic has developed a range of papers on the art and science of planning and scheduling available from Mosaic’s Planning and Scheduling Home Page.

Project Management 2.0

Project Management 2.0 (PM 2.0) seems to be going the same way some Agile anarchists are trying to take software development which is essentially not to do project management and hope a group of people with good will and good luck will create something useful.

Not doing ‘project management’ is a really good idea if you and your client have no idea what’s needed, when its required, or how much budget is available. Journeys of exploration can be fun and can be highly creative but are nothing to do with managing projects.

Wikipedia (retrieved 27/9/2009 from: http://en.wikipedia.org/wiki/Project_management_2.0) lists the following differences between PM 2.0 and ‘traditional’ project management.

PM 2.0 -v- Traditional PM

Whoever wrote this has absolutely no idea what good traditional project management looks like and has probably never worked on a successful major project. Good traditional project management differs from this highly subjective and biased list in many ways:

• Control is not centralised, authority and responsibility are devolved to the appropriate management levels.
• All good project management is based on collaboration.
• All good project management requires open access to the plan both as an input to its creation and to know what needs doing during delivery.
• Access to information is vial when and where needed.
• Open and effective communication is critical.
• Project are,  by definition, separate management entities – a holistic approach (ie, not doing projects) is called general management.
• Tools, see: A fool with a tool is still a fool, and you need the right tools for the right job. Amateurs try to do jobs with inappropriate tools. Easy to use and flexible are fine if you know exactly what you are doing, it is a recipe for wrong information and wrong decisions if you don’t.

The table is correct in so much as project management involves a degree of top down planning. Project management is about delivering a required output to the specifications requested by the client. The product or service is a failure if it does not meet the quality requirements set by the customer; which may include time, cost and scope parameters.

It is also correct in respect of the implied structure – projects work because there is an implied structure that sets a framework for collaboration. If you don’t know who is doing what it is nearly impossible to collaborate. Even Wikipedia and Linux have structure in their collaborative frameworks.

I have emphasised good project management throughout this post. Bad project management involves excessive attempts to ‘control the future’, lack of stakeholder involvement, excessive bureaucracy, and many other problems. These traits are bad management full stop.

One comment on the Wikipedia article is important though: PM 2.0 is good for small jobs. This is consistent with a survey of construction projects in the UK undertaken by the Chartered Institute of Building, focused on time management, which found that on ‘simple projects’ there was no difference in performance between those projects with a properly developed and managed schedule and those without. The same proportions finished early, on time and late.

However, as soon as the projects became ‘complex’; there was a marked difference in performance. Projects with effective schedule control performed significantly better than those without, and the bigger/more complex the project, the more significant the difference. ( I will put up a post on the CIOB’s work and its new practice standard for scheduling in a few days).

The CIOB’s findings and a closer look at many of the blogs and comments on both PM 2.0 and Agile seem to fit this trend. I would suggest two conclusions could be drawn:

1. If the work is small, simple and easy to understand there is no need for much in the way of traditional project controls. Knowledgeable people know what needs to be done and can just get on with the work.
2. If the required output is not capable of being determined by the client and the objective is to ‘create something wonderful’ it is very difficult to apply too many project management techniques – basically you don’t know what needs to be planned, costed and scheduled, etc. Time and cost are secondary to creativity and the exploration of problems.

In both of these circumstances traditional project management may not be appropriate. In fact I would question if either circumstance is actually a project given the definition of a project is to produce a defined product, service or result that meets the needs of a customer.

The challenge for senior organisational management is recognising the threshold where PM 2.0 and ‘free form Agile’ cease to be appropriate and more traditional forms of project management are needed. Traditional project management does not mean ridged control, the type of project influences what’s needed (see: Projects aren’t projects – Typology) but appropriate systems do help optimize cost, time and quality to deliver client satisfaction.

This does not mean dumping the new ideas, rather melding them into an improved project management process. Agile software development fits in nicely to ‘rolling wave’ planning. Similarly some aspects of PM 2.0 can really help enhance team communication and collaboration. Used wisely, these ideas and technologies simply help improve the way projects work to deliver quality outputs to their clients. This change is really no different to the shift from faxes and carbon copy paper to emails. Good project management has always adapted to use improvements in processes and technology to improve the quality of service provided to the project’s clients. This next wave of improved technologies should be no different.

However, be wary of the zealots suggesting the ‘old ways’ don’t work and should be abandoned and use examples of really bad project management to prove their point. This is even more important if the zealots also advocate employing them to solve all of your problems for a fee. Management fads come and go – modern project management has been generally successful in achieving positive outcomes for well over 50 years now and continues to evolve and improve. For further comment see Glen’s post on: Herding Cats

Stakeholder Management with apologies to Dr. Seuss

When beetles battle beetles in a puddle paddle battle and the beetle battle puddle is a puddle in a bottle…
…they call this a tweetle beetle bottle puddle paddle battle muddle.
Excerpted from: Tweetle Beetles, ‘The Fox in Socks’, by Dr Seuss

The connection between a book written to be read to under 5s and business stakeholder management is the ‘puddle muddle’ otherwise known as the stakeholder pool. The challenge of managing stakeholders is a factor of the disturbance caused by dozens if not hundreds of battles most of which, the person attempting to efficiently manage his or her stakeholders has no control over whatsoever.

Most stakeholder management methodologies start by assessing the stakeholder from the perspective of the work. This is not unreasonable but can easily miss many important factors.

Figure 1: The Stakeholder Pool

Figure 1 shows ‘the stakeholder’ in the overall stakeholder pool being influenced by the ripples created by your battle in your part of the pool (your puddle). Unfortunately the stakeholder pool is a much bigger, more turbulent place.

Figure 2: the Stakeholder Pool with turbulence

Show some of the other disturbances in the pool and you start to see the stakeholder buffeted by waves and impacts from all directions, in Figure 2. ‘The stakeholder’ is continually being buffeted by waves from other projects, the organisation and many other influences. These other waves are one of the prime reasons stakeholder responses to your perfectly reasonable needs or suggestions are frequently so unpredictable. All of these influences, both current and past have helped shape the stakeholders perceptions and attitudes towards your industry, your organisation and ultimately, you.

Consequently, a single view point is really not sufficient! Effective stakeholder management needs an organisational approach. Successful stakeholder management requires all of the influences perceived by the stakeholder to be coordinated and authentic. And this can only be achieved by the organisation as a whole adopting mature, ethical stakeholder management as a core discipline.

Very little has been written about mature organisational stakeholder management until recently. To date, the focus of most papers have been one dimensional focusing on CRM and the ‘customer experience’ or one dimensional focusing on the relationship between the stakeholder and a project (or other organisational activity).

A new book, Stakeholder Relationship Management: A Maturity Model for Organisational Implementation, by Dr. Lynda Bourne takes this next step to define the interaction between the organisation as a whole and its stakeholders using the Stakeholder Relationship Management Maturity (SRMM®) model.

Effective and ethical stakeholder management cannot happen overnight and cannot happen in isolation. The preconceived perceptions of stakeholders towards your work are based on multiple experiences over an extended period of time, and the stakeholder-to-stakeholder conversations that occur outside of your hearing or control. To actively improve these conversations and create a positive and supportive stakeholder environment needs a long term consistent effort, organisation wide.

Bourne’s SRMM model offers a practical framework that can be used by organisations to build from ad hoc, single project attempts to manage stakeholders to a situation where stakeholder management is a core skill used by the organisation as a whole to maintain a competitive advantage. As with any culture change, this cannot happen overnight but at least Dr. Bourne’s new book provides a road map organisations can use to improve their management of stakeholder relationships to the benefit of both the stakeholders and the organisation.

Stakeholder Relationship Management: A Maturity Model for Organisational Implementation is published by Gower, ISBN: 978-0-566-08864-3

Thoughts on Agile

Following on from a rather lengthy on-line discussion covering various aspects of the interface between the Agile software development methodologies and project management, we have developed a discussion paper that looks at how the two processes can be integrated.

The paper is a ‘work in progress’ aimed at business managers who are new to the concepts of Agile (ie, it is not intended as an Agile manual for IT professionals). Any comments will be appreciated.

The paper can be downloaded from: http://www.mosaicprojects.com.au/PDF/Thoughts_on_Agile.pdf

Free PMP Questions

The quality of many comments and resource available on the web for the PMP exam are doubtful to say the least.

Apart from issues with various PMP guarantees discussed in an earlier post (view: Guaranteed PMP Pass?), my major bugbear is the array of half-baked PMP questions available. I am sure the high PMP fail rate is partly due to people having a false sense of security based on ‘successfully’ answering a range of simple free questions…….

To help counter this we have developed a set of 30 questions as a free resource (no log-on required) focused on real PMP level knowledge assessments. If you, or anyone you know wants to see how their knowledge stack up you are welcome to have a go….. The questions are available from http://www.mosaicprojects.com.au/Free_PMP_Questions_1.html.

Whilst the problems with CAPM are less, we have also developed 25 CAPM questions which are available from http://www.mosaicprojects.com.au/Free_CAPM_Questions_1.html.

Apart from normal web traffic monitoring there are no systems on these pages to track users or downloads and being we are a small business based in Melbourne Australia there’s little ‘commercial’ value to us in people making use of the free facility outside of our home base, so please feel free to pass this resource on to anyone you know interested in the PMP exam (having done the hard work writing the questions I would hate to see it wasted).

Resourcing Schedules – A Conundrum 2

Following on from comments to my post ‘Resourcing Schedules – A Conundrum’  there are still some basic problems to resolve.

As the commentators suggest, KISS is certainly an important aspect of effective resource planning: ie, planning resources at an appropriate level of detail for real management needs. But the basic issues remain; you cannot rely on a scheduling tool to optimise the duration of a resource levelled schedule.

We use the basic network below in our Scheduling courses (download the network – or – see more on our scheduling training)

Network for Analysis (download a PDF from the link above)

No software I know of gets this one ‘right’.

When you play with the schedule, the answer to achieving the shortest overall duration is starting the critical resource (Resource 3) as soon as possible.

To achieve this Resource 2 has to focus 100% on completing Task B as quickly as possible BUT, Task C is on the Time Analysis critical path not Task B and 99% of the time software picks C to start before B.

This is not a new problem, a current paper by Kastor and Sirakoulis International Journal of Project Management, Vol 27, Issue 5 (July) p493 has the results of a series of tests – Primavera P6 achieved a duration of 709, Microsoft Project 744 and Open Workbench 863. Play with the resource leveling settings in P6 and its results are 709, 744, 823, 893 – a huge range of variation and the best option (P6) was still some 46% longer than the time analysis result . Other analysis reported in the 1970s and 80s showed similar variability of outcomes.

As Prof. George Box stated – All models are wrong, some are useful… the important question is how wrong does the model have to be before it is no longer be useful.

Computer driven resource schedules are never optimum, done well they are close enough to be useful (but this needs a good operator + a good tool). And good scheduling practice requires knowing when near enough is good enough so that you can use the insights and knowledge gained to get on with running the project. Remembering even the most perfectly balanced resource schedule will fall out of balance at the first update…..

How you encapsulate this in a guide to good scheduling practice is altogether a different question. I would certainly appreciate any additional feedback.

Guaranteed PMP Pass?

Prospective candidates for any PMI examination, including the PMP credential need to be vary wary of ‘guarantees’ from some training organisations.

PMI closely manage the security of their exam system and no one can ‘guarantee’ a pass. Candidates take a secure exam with an individually selected mix of questions and pass if they score more than 61% on the day. Less than 61% correct answers = failure!

Despite PMI explicitly prohibiting R.E.P.s from offering guarantees that cannot be substantiated, and obviously ‘guaranteeing’ a pass is impossible, it does not stop some organisations from trying.

Over the last several weeks, we have received a series of emails from FACT Training in New Zealand with a tag line ‘Guaranteed to Pass the PMP Exam!’ and on opening the email the first words are PMP® Preparation Exam Success Guaranteed (in big bold yellow lettering).

FACT Training are the Australian / New Zealand franchisee for Cheetah Learning so you have a guarantee wrapped around a well known brand for a course that costs over $3000. You would assume you are onto a good bet?

WRONG!

Dig into the fine print and you find the ‘guarantee’ is subject to the ‘Terms and conditions of the Cheetah Guarantee’. The ‘Cheetah Guarantee’ retrieved from http://www.cheetahlearning.com/FAQ.asp#What%20is%20your%20guarantee this afternoon starts off:

• We guarantee that you will pass the PMP exam after participating in our accelerated PMP exam preparation program

Looking good until you read on!
The ACTUAL ‘Cheetah Guarantee’ is as follows:

1. You come to class pre-approved by PMI to take your exam (this requires you to have already completed 35 hours of study before beginning the 4 day intensive course).
2. You have your memory map memorized (no idea what this means)
3. You participate in all parts of the program
4. You take the exam within seven (7) days of completing the course (subject to availability of test places)
5. If you do not pass the PMP exam, your instructor will create a personalized coaching program to help you shore up your weak areas and will guide you through the process of rescheduling your exam. (You do the work)
6. Your second exam must be taken within 30 days of the first exam.
7. If you do not pass again, you have to re-sit for the third time within another 30 day maximum period and only then does the real guarantee cuts in!

The real Cheetah Guarantee is that upon request they will fully refund the fee you paid them to take the course. And also they will refund the two re-sit fees of US$275 each (PMI Member rates) you have had to pay to re-book the exams – nothing else.

There seems to be a slight difference between ‘guaranteeing a PMP pass’ as per the FACT Training email and the actual Cheetah Guarantee of some of your money back if you manage to jump through all seven hoops and are still unlucky enough to fail.

Mosaic is a PMI R.E.P. and coincidentally have a very similar success rate to the 98% pass rate claimed by FACT Training. However, we operate from a very different ethical basis:

1. We guarantee to keep working with trainees until they pass (ie, we spend our time and money working with the one or two people unlucky enough to fail each year until they either pass or decide to move on).
2. We do not offer a money back guarantee (with or without multiple hoops for the trainee to jump through) for two reasons:
   1. We feel it important for trainees to have some ‘skin in the game’.
   2. We don’t think it is reasonable to charge a premium on all candidates’ fees to cover the risk for a few.

The challenge I propose to all prospective PMP candidates is to check out the actual guarantees from potential training providers and ask yourselves two questions:

Do I want to deal with an organisation that offers sham guarantees – what does this say about other aspects of their business ethics and service?

Do I want to pay the price premium associated with a very limited guarantee such as the Cheetah Guarantee above? 

• FACT Training’s advertised course fee is US$3250.00 for a 4 day course in Melbourne Australia, in October.
• The PMI Melbourne Chapter fee for a 5 day course in November is AU$2475.00 (approximately US$2130.00). The course is delivered by a professional R.E.P. and PMI members receive a discounted fee of $1,980.00 (view course details).
• Mosaic’s Mentored Email™ course fees are AU$1,320.00 (but there are no venue costs for a distance learning course – see details)

PMI have been working to clean up the advertising of PMP courses by R.E.P.s for several years you can help by voting with your feet and not doing business with organisations that offer impossible guarantees.

I my opinion, there’s nothing wrong with ‘money back’ guarantees provided the terms are clear and not too onerous, many reputable R.E.P.s offer this type of guarantee. However, I do object to organisations pretending to ‘guarantee a PMP pass’ then hiding their real guarantee on another web page.

What do you think?