The Three Secrets to Long Term Earned Value Success

Have you ever been in an organization or on a project that implemented the use of Earned Value, only to throw it away after a period of time? Perhaps the system they implemented just lost steam and suffered a slow death, or maybe it was a manager that cut the cord. Either way, the organization clearly did not implement some key elements for maintaining Earned Value success in the long term. Earned Value Management Systems can be quite costly to design and implement, so it’s in your best interest to create a system that can stand the test of time. 

There are three main areas that will greatly affect the long term success of your EVMS. If you think of your EVMS as a pirate ship, these three areas would be: the map used for navigation (strategy), the crew on board the ship (personnel), and the tools made available for propelling and steering the ship—such as the sail or oars (software). Let’s break down these specific areas and see how they affect your EVMS success over the long haul: 

Strategy. The map used by the pirates must not be torn, held upside down, or illegible. How can you get to your destination if your map is garbage? The strategy is the design and implementation of the EVMS, as well as the procedures for how to use and maintain the system. A poor strategy will kill the EVMS—just think of all the headaches you may have if your system doesn't have the appropriate interfaces and you’re updating too much manually. That’s a ripe condition for human error and a massive waste of time for little value added. The design of your system needs to be fully planned and mapped. Identify your requirements, then design your steps and interfaces in support of the requirements. Look for ways you can automate tasks, or reduce the production and revision cycles. Also consider: your strategy will determine the reliability of the data in the system because it manages your inputs and outputs. This is your basic “junk in, junk out” scenario. Why is this so important for long term EVMS success? Well, if you’re a manager looking at junk on a project performance report, are you going to rely on those numbers? Are you going to trust the people who generated it? Nope. Hence the death of your EVMS. 

Personnel. The crew on your ship includes everyone from the captain to the cook. First, let’s examine the captain, or “management”. If management does not support the EVMS wholeheartedly, then it is setup for failure from the beginning. You see, long term EVMS success requires not just a commitment by management, but also a belief in its value—so much so that they live and breathe the EVMS. It needs to be fully saturated and ingrained in the corporate culture. Why? If they don’t believe in it, they won’t use the outputs for decision making. Then, at some point they will stop providing funding and support for managing it simply because they don’t see the value in it. That affects the project managers, because they may be trying to use the data to show project performance and get management support, but their case won’t have any “teeth”. They won’t be able to use authority to get activities done, especially activities in other departments in a matrix or functional organizational structure. In these scenarios, the EVMS becomes a token or a show, not a real tool—and tokens don’t get funding. 

The other crucial aspect of personnel involves having the right people doing the right jobs.  Too many times, companies will use a finance person to manage the EVMS (especially smaller companies, or those new to Earned Value). The problem is that most finance folks do not have the understanding or respect of Earned Value inputs and outputs. They end up having difficulties during monthly status but even more so during baseline changes. Likewise, some companies will use a scheduler to perform cost activities, or cost engineers to create and maintain schedules. These ill fitted placements mean more mistakes and inaccurate data. To stretch this idea even further, consider how a manager with a very traditional business sense may see project performance versus someone well versed in project management and Earned Value. The traditional manager may try to use the EV data to beat up the project manager and team, because he doesn’t fully understand Earned Value. This will cause the team to hide their performance on the reports, and then the concept of an EVMS is undermined. A manager seasoned in EV will know that the data is to be used as early warning indicators for improved decision making and management support, not for hanging people. So make sure the right people are in the right jobs, and the results will improve your EVMS instead of hampering it. 

Tools. Our pirate ship uses sails, oars, cannons, guns, etc. to get where they need to go and kill their enemies. In the realm of EVMS, your most important tool is your software. This includes your software for scheduling, accounting, EV processing, change management, reporting, work management, and so on. Also in this category is the ease of interfaces between these tools. The simple answer is to find software that is logical, intuitive, and can easily “talk” to all of your systems. If you purchase EV software that is complex and cumbersome, you’re going to have problems with users and likely interfaces. People tend to use things that are easy and “feel good”. If your software requires 37 steps each month for statusing and reporting, then the user may get frustrated, miss a step, complete the steps out of order, etc., all of which impact the timeliness and reliability of your data. Simplicity is key, and you don’t have to sacrifice flexibility and power for ease of use. Just do your research and ask around. Remember, even if you have a great strategy and your management lives and breathes the EVMS, you can still fail if you don’t have the right tools. However, if management really is committed, then they will quickly figure out that the software is a problem and will find the money to buy the right software, and possibly bring in consultants to design, implement, test, train, etc. 

Ultimately, for long term success, Earned Value has to be an integral part of managing projects within the organization. If you keep that idea in your mind, the three areas of focus, strategy, personnel, and tools, will fall into place easily. Do you have any experience with the success or failure of an EVMS? 

- Melissa Duncan (About Melissa)

Read the previous posting - Passing the Snicker Test: 5 Tips for Improving the Measurement of Work Performed

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Earned Value legend as there may be a few of us that don’t yet have this memorized…

CA=Control Accounts
CAM=Control Account Manager
CPI=Cost Performance Index
EAC=Estimate At Completion  

EVM=Earned Value Management

EVMS=Earned Value Management System

EVT=Earned Value Techniques

EAC=Estimate At Completion 

IPMR=Integrated Program Management Report

LOE=Level of Effort

OBS=Organizational Breakdown Structure

OTB=Over Target Baseline

PC=Project Controls

PM=Project Manager

PMB=Performance Measurement Baseline

RAM=Responsibility Assignment Matrix

SPI=Schedule Performance Index

WBS=Work Breakdown Structure

Passing the Snicker Test: 5 Tips for Improving the Measurement of Work Performed - Part 2

Surprise!  Your EVMS has just been selected for an audit by the client.  Are you nervous?  

You should be, if there is any chance your earned value data doesn’t align with the real status of your projects.  It’s rather embarrassing to report work as being finished, only to walk out in the field with the client and SEE that it isn’t done.  Unfortunately, the technique used to measure earned value on that activity cannot prevent such a scenario.  Earning techniques can be thought of as administrative controls to enhance the reliability of earned value data.  That’s all fine and dandy, but administrative controls are simply not enough to ensure your EV is on target.  Even if you have employed the best earned value technique for each activity in your schedule, your earned value data may not pass the snicker test.  Projects are dynamic; they require the addition of common sense sprinkled with the school of hard knocks to add reliability to the earned value measurement.

While earned value software is typically blamed for incorrect data, more often than not the problem is with the humans using it.   It isn’t any secret that your EVMS is only as good as the data you put into it.  Lack of employing some practical tips to improve earned value measurement is like contracting a deadly disease: your project can become very sick over time.  However, there ARE some things you can do to increase or enhance the reliability of the earned value data.  After all, you and your management are making critical decisions about the project based on this information, so you had better find some dependable ways to measure EV. 

Some of these practical tips are intuitive, others not so much.  Let’s take a look at some examples: 

TIP 1: Get the project manager, CAMs, and schedulers out in the field or workspace to see progress for themselves.  Frequency depends on the project and how often the schedule is statused.  Generally speaking, they should put their eyes on the work before each status update.  This is probably the number one key to enhancing the reliability of the earned value data, yet it is also where many fail.   Visiting the field, looking at drawings, or reviewing a software update are activities that are often put on the back burner because there is “real work” to be done.  However, seeing progress and talking to workers can make the difference between success and failure.  Get out of your chair and go look at progress for yourself.

TIP 2: Review every work package or control account and see where you can add periodic and objective deliverables.  This can even work for program management and support.  For example, a PM will likely have a status report due each month, period, or quarter. That’s a deliverable.  It has scope with a start and finish that can be defined and measured.  Digging a hole for the next 4 months?  Measure the cubic yards of dirt extracted, or how deep the hole is—make them weighted milestones if needed.  The point is, expand your definition of a deliverable and you’ll find you can objectively measure more than you thought.  Other common methods of increasing objectivity include using gates, milestones, and breaking up long duration tasks into shorter, more manageable ones, preferably with a tangible deliverable as its output.

TIP 3: Limit LOE tasks.  We all know LOE is the ugly redheaded stepchild of EV techniques.  But it has its purpose as well.  In addition to finding measureable deliverables in the land of support tasks, you can increase your confidence in your EV by limiting LOE to 10-15% of the overall project budget.  This is a common general rule of thumb, and I bet there are folks who have done similar projects with a cap on LOE.  Talk to those people.  What did they do to reduce LOE tasks or convert them to objective and measurable deliverables? 

TIP 4: Plan for rework.  Rework is a huge drain on the project’s earned value.  If you didn’t plan for enough rework, you’re going to be spending a lot of effort on things that aren’t yielding ANY performance and are eating up your margin.  Suddenly your positive cost variance tanks.  Some rework is inevitable—so research similar projects and see how much rework was needed.  Plan for it as best you can and document your strategy and assumptions for rework upfront.  That’s right, plan for it.  Just as you would contingency.  In fact, sometimes the project risk matrix will give you a heads up as to the areas at greatest risk for rework.  Remember to include the risk of the effects of out of sequence work and cancelled work, both of which can cause rework.  

TIP 5: Make vendors prove their progress.  If a vendor or subcontractor is performing work offsite, visit their facility or work site if possible.  See progress with your own eyes.  If you cannot visit their work site, require them to take pictures or videos of progress as part of their periodic progress report or hire an auditor to be your eyes.  Otherwise it becomes too easy for them to lie to you during conference calls and in emails.  They’ll say they are getting close to completion.  Then they have to push out the completion date for some unforeseen issue….over and over and over again.  So make evidence based progress reports a deliverable in their contract, and build payments around progress and performance.  You can also incentive them with bonuses for performance.  

Bonus Tip: There’s one major tip for improving your earned value measurement that I have left out because I believe it to be obvious.  However, it is so paramount to project success that I can’t skip over it completely.  That is: develop a realistic project plan.  This includes using lessons learned from other similar projects and engaging the entire team during the planning process.  After all, earned value is performance measured against the plan, so a poor plan will yield poor earned value data as well.  

Do you have other tips for improving the measurement of earned value?  Please feel free to leave a comment.  Upcoming next month: Secrets of Long Term Earned Value Success.  Subscribe so you don’t miss it!

- Melissa Duncan (About Melissa)

Read the previous posting - It’s Harder Than You Think!  Measuring Work Performed Successfully Part 1

Subscribe to Earned Value Exposed Blog

Earned Value legend as there may be a few of us that don’t yet have this memorized…

CA=Control Accounts
CAM=Control Account Manager
CPI=Cost Performance Index
EAC=Estimate At Completion  

EVM=Earned Value Management

EVMS=Earned Value Management System

EVT=Earned Value Techniques

EAC=Estimate At Completion 

IPMR=Integrated Program Management Report

LOE=Level of Effort

OBS=Organizational Breakdown Structure

OTB=Over Target Baseline

PC=Project Controls

PM=Project Manager

PMB=Performance Measurement Baseline

RAM=Responsibility Assignment Matrix

SPI=Schedule Performance Index

WBS=Work Breakdown Structure

     

It’s Harder Than You Think! Measuring Work Performed Successfully Part 1

We can’t really “expose” all the secrets of Earned Value without discussing the heart of it all: how to actually measure work accomplished.  Frankly, one of the reasons Earned Value Management is not more widely used is because it can be somewhat complicated and cumbersome to understand—let alone set up a useable and high quality system.  The fundamental principle of measuring work performed and then comparing to the planned work and the actual costs is straightforward.  As with many systems, the devil is in the details.  It turns out there are a number of different ways to measure work accomplished and each has advantages and disadvantages.  

Some of you may be thinking, “Yeah yeah yeah, I know all about Earned Value Techniques”.  But have you really stopped to think about the impacts of one method over another?  Have you thought about the variances that could be inadvertently caused by the wrong choice?  Knowing the different ways earned value is measured will help you determine the methods best suited for your organization and projects.  So, let’s take a look at some commonly used Earned Value Techniques (EVT) and their use:

Fixed Formula:  This method applies a predetermined percentage of the activity’s Budget At Completion (BAC) to be earned at the start and end of the activity.  The most common percentages used are 0/100, 50/50, 25/75, but you can create your own, such as 10/90, if desired.  That’s perfectly acceptable and your Earned Value software should allow for this customization easily.  Do NOT mistakenly use this on long duration activities unless you want to be beaten up during variance reviews!

Percent Complete: Perhaps the most common EVT, percent complete, is also very subjective.  The person statusing the schedule estimates how much of the activity has been performed and that value is multiplied by the activity’s BAC to generate the EV.  The accuracy of this measurement is highly dependent on the person’s knowledge (and honesty) of the effort to complete the activity.  And if they are too lazy to truly find out how much work was done, the PM could look like a fool, or worse, a liar.

Weighted Milestones:  This method applies budget to milestones, instead of activities, to allow for more objective measurement.  It divides the work into segments with a milestone at the end of each segment.  It’s great for work packages with periodic tangible deliverables. This prevents the overestimation of work completed because nothing can be earned until a milestone is met.

Weighted Milestones with % Complete:  This is a hybrid EVT as the name suggests.  Milestones hold the budget as described above, but instead of waiting until the milestone is met to earn anything, partial credit is given to the milestone for work that is in progress.  It’s well liked by clients because of the tangible milestones, but also by the contractor because they get credit for work partially done.

Units Complete: If you have units of the same budget value, such as cubic yards of soil, then it’s “easy” to determine how many units were completed against the plan.  This is a common technique in production environments, and is seen in large construction projects as well.  I’ve seen measurement of units turn into science projects; so determine how to measure units before you trek down this path.

LOE: Level of Effort activities are typically used on tasks without tangible outcomes, such as Project Management Support.  It assumes that you’re earning whatever was planned--basically if you’re there and breathing, you’re earning.  Since it is based on time instead of objective measurements, it can skew EV numbers and metrics, so minimize LOE type activities as much as possible.

The wrong technique can cause massive headaches on a monthly basis, as well as when incorporating a baseline change.  So be careful; choose the one that best illustrates how the work will be done.  And be consistent!  Don’t choose 0/100 for one drawing and percent complete for the next; that’s crazymaking!

Do you have any insight into EVT selection?  Please leave a comment and share with us.  And stay tuned for Part 2 of this series on measuring work performed, where we will discuss tips and tricks for improving the measurement of earned value.

- Melissa Duncan (About Melissa)

Read the previous posting - 6 Reasons Your Favorable Performance May Be Too Good To Be True

Subscribe to Earned Value Exposed Blog  

Earned Value legend as there may be a few of us that don’t yet have this memorized…

CA=Control Accounts
CAM=Control Account Manager
CPI=Cost Performance Index
EAC=Estimate At Completion  

EVM=Earned Value Management

EVMS=Earned Value Management System

EVT=Earned Value Techniques

EAC=Estimate At Completion 

IPMR=Integrated Program Management Report

LOE=Level of Effort

OBS=Organizational Breakdown Structure

OTB=Over Target Baseline

PC=Project Controls

PM=Project Manager

PMB=Performance Measurement Baseline

RAM=Responsibility Assignment Matrix

SPI=Schedule Performance Index

WBS=Work Breakdown Structure

6 Reasons Your Favorable Performance May Be Too Good To Be True

You know the scenario well: it’s the end of the period and now you eagerly await the results of the latest schedule status.  Will the status align with the planned and actual costs?  You process the data and the results spit out of your EVM software.  Ta-da!  Your SPI or CPI are stellar!  Congrats!  But wait…a savvy PM knows when favorable variances and trends are deceiving.  The issue is much more complicated than just overestimating the percent complete progress for a few activities.  It emphasizes importance of true data analysis and non-complacency in relying on the numbers all the time.  Do you know how to spot deceivingly favorable performance?

While positive performance is generally a good thing, there are times it can come back to bite you…eventually.  Let’s take a look at the lesser known causes of deceiving performance numbers so we can determine how to best avoid them:

1. Poor Scheduling.  I doubt this one is much of a surprise, but it confounds me how many projects have schedules so poorly developed and thought through.  Activities out of sequence, as well as shoddy durations, man-hours, or materials estimates can all cause positive variances that are false in any given period, and may continue for several.
2. Devious Scheduling. This is different from poor scheduling in that it is done on purpose.  Specifically, this is done by baselining activities too conservatively (too long, too many hours, too far into the future), and doesn’t come close enough to reality.  Perhaps the PM did this on purpose to look like a hero by coming in well ahead of schedule or under budget.  The danger is that it also hinders the ability to really measure progress.  
3. CPI/SPI Out of Sync.  Sure, maybe you worked fewer hours overall, but you also didn’t get some of the work done.  How can this cause false positive performance, when you can’t earn value on work not done, you ask?  One answer is Level of Effort activities.  LOE will earn value whether staff is working or not.  Another answer is skeleton crews.  An example would be when excavation is still underway (using a crew of 3, instead of 5), and the 4th and 5th members are on vacation—along with most of the office staff (who are budgeted as LOE) for the holidays.  The forecast may show a favorable trend with a decline in total cost, but this disappears when everyone comes back to work in January and then puts in overtime to make up the work that wasn’t done over the holidays!
4. Wrong Tasks Progressing.  This is where Critical Path analysis (CPM) is important, as it reviews the mix of performance in the Control Accounts.  If activities are being work out of sequence, it might look favorable for now, especially if the working activities have a higher budget than the original planned activities for this time period.  However, it could result in added time/cost later.  This is your classic case of the cart before the horse.  A common example is developing too much training material before the final product is done, which then causes rework.  
5. Crashing the Schedule.  It doesn’t have to be a full-on crash, in fact it could be just a few activities with larger budget on them.  The SPI will show the project is ahead of schedule (either current period or cumulatively), because you threw more resources at these activities, although now the EAC is sky-high.  But hey, you’re gittin’ it done!  Here’s a tip: you should ALWAYS review your CPI and SPI in relation to each other.  
6. EV Method Misalignment Between the Baseline and Active Plan. Most commonly this crops up in the form of a negative variance, but it can be found to cause positive variances too.  For example, the baseline is level loaded (linearly) for a 4 period task, but the scheduler mistakenly statuses it as 50/50.  The 1st period will have huge positive variances since you earned much more than planned.  But then it will be followed by 2 periods of negative variances, until it catches up in the 4th period—where reports will finally show whether you were truly efficient or not.  

Ultimately, deceivingly positive performance boils down to either false information, or an anomaly that cannot be sustained.  Experienced, knowledgeable Project Managers know these are some of the reasons you cannot work in a vacuum with EVM.  Performance must be assessed in relation to individual tasks, groups of tasks, the entire schedule, the baseline time-phasing, the EAC, as well as the current period and cumulative to date information.  It’s a symphony of data—a system, and can only be effectively managed when treated as such.  Incidentally, this is one reason your EVM software is so important—a good package will offer many ways to easily slice the data so you can see these issues, because sometimes you have to dig pretty deep to find them.

Obviously not all positive performance is caused by these things!  Sure enough, your project MAY be excelling.  But you’d better know the difference.

Do you have any other examples of false favorable conditions?  Please feel free to leave a comment, and check out the next blog, “How to Truly Measure Work Accomplished”.

- Melissa Duncan (About Melissa)

Editors Note: We generally post twice a month, for December we will be posting only once and return to twice a month in January 2015.   

Read the previous posting - The Alternative to Earned Value Management: it’s called being FIRED!

Subscribe to Earned Value Exposed

Earned Value legend as there may be a few of us that don’t yet have this memorized…
CA=Control Accounts
CAM=Control Account Manager
CPI=Cost Performance Index
EAC=Estimate At Completion  

EVM=Earned Value Management

EVMS=Earned Value Management System
EAC=Estimate At Completion 

IPMR=Integrated Program Management Report
LOE=Level of Effort
OBS=Organizational Breakdown Structure
OTB=Over Target Baseline
PC=Project Controls
PM=Project Manager
PMB=Performance Measurement Baseline
RAM=Responsibility Assignment Matrix
SPI=Schedule Performance Index
WBS=Work Breakdown Structure

The Alternative to Earned Value Management: it’s called being FIRED!

How does a large corporation, filled with thousands of people and multi-million dollar projects, manage their projects successfully without using Earned Value Management?  What is this wonderful alternative to EVM that allows them to effectively manage projects and measure performance?  Let’s face it, EVM can be terribly cumbersome depending on your contract requirements and system design, so it only makes sense to seek a less painful alternative.  This is my number one question I ask when interviewing for a new job or consulting with a new client.  And the answer is usually the same: they’re simply a bit delusional when defining project success and failure—that is, they don’t even know the criteria for successful project management, let alone how to measure it!  

The danger here is that they are so arrogant that they think they know.  They think it is the same criteria that they use for the rest of their business management.  If a manager is excelling at functional management, that should translate to excelling at project management right?  It’s all management in the end, so why would it not work?  They view earned value software as a necessary (or rather, an unnecessary, but contractually required) evil, instead of a useful tool to help manage projects and add visibility into performance.  For Pete’s sake, these are the same people who think there is nothing wrong with keeping their project costs separate from their schedules!

These companies have been successful with other aspects of their business and they’re riding on the coattails of that success. It seems as if they are operating with their heads in the sand when it comes to new management models for projects. They use traditional business models to manage their projects and then are shocked when it doesn't work as expected.  Once senior management starts paying attention to this problem, the project manager is often removed or fired.  This is their way of holding someone accountable, which they love to do.  Ironically, most of those senior managers fail to see that THEY have not held themselves accountable; they haven’t provided the tools to effectively manage projects.  They don’t understand why comparing the budget to actual cost is NOT sufficient for project management or why additional tools, such as procedures, processes, and earned value software are needed.  They are completely missing the value of the work that was completed, yet isn't progress the number one, consistent requirement of project completion?  Yet, in many organizations I've encountered, the old adages of "that's the way we've always done it" and "why fix it if it isn't broken" are so heavily at play, you'd think it was their official vision statement or mantra!  Doesn't it seem odd to not measure progress?

The problem is that it IS broken but they cannot see it until it is too late.  Comparing the budget to actual cost simply yields a spending variance.  They focus on minimizing expenses and maximizing profit margin—both of which end up being heavily impacted by the project management effectiveness.  However, what is the true cost of poor project management?  Poor client relationships and lost future work, confusion and burnout within the team, inadequate resource allocation and funding requests, unnecessary beatings of the wrong manager, missed opportunities to forecast and course correct early in the project, and lack of visibility into true performance resulting in blind decision making—just to name a few.  In an immature, non-learning organization, this does not bode well for the project manager and his/her job is at stake, as well as their reputation in the project management community.  There is a reason project management is now finally recognized with its own degree program at savvy universities.  It’s a science and an art, separate, but related to business management.

Part of the resistance to implementing EVM is the time and cost of setting up the system.  Especially in government projects that require a certified EVMS.  While it is true that implementing all 32 criteria from the ANSI/EIA-748 can be overwhelming and even a little overkill, even a rudimentary EVMS would allow better project visibility and performance.  The “all or nothing” attitude regarding EVMS does it a terrible injustice.  It CAN be sized according to your needs.  The real role of senior managers is to provide employees with the right tools for their jobs, remove roadblocks to success, and then stay the heck out of the way!

So don’t throw the baby out with the bathwater—EVM is the “it” tool for better project performance.  It’s been around for 60+ years, and continues to prove its success.  There is no viable proven alternative, but you CAN lose your job if you choose not to use it.

Have you ever searched for an alternative to Earned Value Management, and if so, what were your results?  Why do you think many companies resist using EVM in some form?  Check out my next blog, “If it looks too good to be true, it probably IS!!”

- Melissa Duncan (About Melissa)

Editors Note: We generally post twice a month, however for November and December we will be posting once a month and return to twice a month in January 2015.   

Read the previous posting -  5 Points of Failure for an EVMS

Subscribe to Blog  

Earned Value legend as there may be a few of us that don’t yet have this memorized…

CA=Control Accounts
CAM=Control Account Manager
CPI=Cost Performance Index
EAC=Estimate At Completion  

EVM=Earned Value Management

EVMS=Earned Value Management System
EAC=Estimate At Completion 

IPMR=Integrated Program Management Report
LOE=Level of Effort
OBS=Organizational Breakdown Structure
OTB=Over Target Baseline
PC=Project Controls
PM=Project Manager
PMB=Performance Measurement Baseline
RAM=Responsibility Assignment Matrix
SPI=Schedule Performance Index
WBS=Work Breakdown Structure

Beware of the Five Points of Failure for an EVMS

Does your organization have a successful EVMS running already?  If you answered “yes”, how can you tell it’s truly successful?  You already know that success is not as simple as collecting data and reporting every month.  Success also means using the data to make decisions and course correct the project when needed.  However, even if you’re using your EVMS appropriately, it doesn’t mean it isn’t sick.  Perhaps your EVMS is diseased and you don’t even know it, until it begins exhibiting symptoms later down the road.  What went wrong?  How can you tell if your EVMS is diseased when all appears to be going well?

If your contract requires a certified EVMS, then you have one powerful weapon in your arsenal to fight an insidious disease that could cripple your EVMS.  In fact, having a customer require a successful EVMS is perhaps one of the greatest vaccines against a diseased system.  However, if you aren’t required to have a certified EVMS, or if you’ve contracted an EVMS infection, your system can still get very sick and die.  Let’s take a look at five major illnesses that can cause your EVMS to fail:

1. Management isn’t driving your EVMS.  The lack of passion and commitment to a strong EVMS by management is the number one virus I see in sick systems.  No matter how much effort you’ve put into your EVMS, you can still end up with a slow, flesh-eating virus in the form of senior management’s lack of commitment.  Let’s face it, a successful EVMS needs to be driven by management; they are leading the show and they have the ultimate power.  It’s a corporate culture issue, and one that needs to be corrected, pronto!  Symptoms of this virus include: management doesn’t understand the EVMS, see its value, use it for decision making, appreciate its difficulty and complexity, take it seriously, or give it appropriate time/resources to implement and maintain, etc.  If management does not drive it, then it will be seen as an “add-on”; something that is only for show.  It won’t be used to manage projects, and it becomes only something that generates pretty pictures, or perhaps just something those project controls folks make you do.  This virus is so rampant and destructive in some organizations that I encourage you to check out How to Get Management to Not Only Buy-In to EVM, but Drive It…

2. Your EVMS cannot generate useful data.  Despite spending gobs of time and money designing it, sometimes the EVMS doesn’t yield useful information.  This mistake is like the common cold; you can function for a while, but if you don’t tend to it, you’ll end up in worse shape.  You’ll know you’re in this situation if you’re doing too many things manually, or having to change key elements—such as the WBS—in mid stride.  The cause of this common problem includes choosing the wrong EVM software for your needs, lack of focus on integration of systems when designing the EVMS, and hiring the wrong people to implement and run the EVMS.  If you find yourself in this situation, it’s time to stop and fix it before it becomes a bigger problem.  At this point, you may wish to hire an outside firm to assist, because clearly, the people who designed and implemented your current EVMS were not totally successful.  Sometimes that is due to internal conflicts and an outside firm can have more clout with internal stakeholders.

3. Mid to lower level management and CAMs don’t support or accept the EVMS.  While this is related to item #1, it is in a class by itself as well.  Even if senior level managers drive EVMS, if your organization is too top heavy, you may end up finding that the message from senior management is watered down by the time it reaches the trenches.  If you have a manager that doesn’t take the EVMS seriously, or even degrades it, you’ve got a real problem on your hands.  This is the kind of person that can “infect” others with their mentality by constantly complaining about the EVMS.  They are the cancer of your EVMS.  These folks may see it only as a necessary evil, and certainly nothing that will make their management skills any better.  They fear getting caught in their lack of performance and tend to blame the system.  They need to be removed from this position as soon as possible.

4. Your EVMS begins dying a slow death and momentum is lost.  You’ve just won a new contract and everyone is running around like a chicken with their heads cut off in order to get the EVMS up and running, and certified.  The whole team is running on adrenaline and it seems everyone is excited for a while and then….the focus begins to shift.  Some people quit, new people come in, time goes on, and eventually the EVMS is running on autopilot.  It feels old and stale.  However, this also points back to issue #1.  Why?  Well, if senior management was really passionate about it and used the information in the EVMS to make decisions, then it would stay at the top of everyone’s priority list.

5. The critical users of the EVMS are inexperienced and untrained.  I’ve witnessed the disaster caused by organizations that hire the wrong people to design, implement, and maintain the EVMS.  Hiring an accountant to run the EVMS isn’t going to work!  Earned value isn’t an overly complicated concept, but there are plenty of complex problems that can arise from various scheduling elements, settings in the EVM software, calculations to understand, etc.  Then there are plenty of CAMs who don’t understand how to write variances, as well as managers who can’t read a project status report or IPMR.  There are so many variables that can affect the data—so be sure you have people who understand it forwards and backwards.  The EVMS cannot survive when the inputs, outputs, and users are lacking.  It’s the equivalent of having pneumonia.  So find an EVM software that is user-friendly and can integrate with your other systems, write procedures that make sense, and then train, train, train!  

Half the battle is in knowing that you have a problem.  So take some time to really assess the health of your EVMS and make changes where needed—before it dies a slow death.  And if you have had any experience with these diseases, or any others that have killed an EVMS, please leave a comment below!  Next week we will take a look at The Alternative to Earned Value Management, It’s Called “Being Fired!”

- Melissa Duncan (About Melissa)

Editors Note: We generally post twice a month, however for November and December we will be posting once a month and return to twice a month in January 2015.   

Read the previous posting - Finding EV Software with a Low PITA Factor

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Earned Value legend as there may be a few of us that don’t yet have this memorized…

CA=Control Accounts
CAM=Control Account Manager
CPI=Cost Performance Index
EAC=Estimate At Completion  

EVM=Earned Value Management

EVMS=Earned Value Management System
EAC=Estimate At Completion 

IPMR=Integrated Program Management Report
LOE=Level of Effort
OBS=Organizational Breakdown Structure
OTB=Over Target Baseline
PC=Project Controls
PM=Project Manager
PMB=Performance Measurement Baseline
RAM=Responsibility Assignment Matrix
SPI=Schedule Performance Index
WBS=Work Breakdown Structure

Finding EV Software with a Low PITA Factor

There is really only one thing you need to keep in the forefront of your mind when looking for EV software with a low PITA factor.  

It’s the same thing that has made the Apple iPhone hugely successful, despite all its competitors.   However, when we begin listing the requirements for our EV software, sometimes we lose sight of the one thing that is going to make or break the success of the software you thought was going to make your life easier.  We start focusing on all the bells and whistles and we begin dreaming of a future with all this wonderful information about our projects—if we buy this really cool software.

Can you guess what it is yet?  If you ask a devoted Apple iPhone user why they love their

cell phone, you’ll likely hear about the iPhone “experience” or perhaps the friendly and intuitive user-interface.  Boil it down in a nutshell and the answer becomes “ease of use” via the simplistic design.  Sure there are others that have more features, yet the iPhone has a very loyal following that its competitors can’t break.  Keep that in mind.

What does that really mean when we talk about EV software?  It is a much broader concept than you might initially think.  It transcends every item on your list of software requirements.  Let’s take a look at some of the requirements you may have for your EV software and consider some ease of use aspects that may make a huge difference in your work life.

1. Robust enough to handle thousands of activities and resources.  OK, so you have some humongous schedules with a massive listing of resources.  If your software is too cumbersome to operate, it doesn’t matter if it could handle billions of activities.  Cumbersome EV software either takes an army to manage, or a lot of time for those few people who understand how it works.  That’s going to cost you time and money, and possibly some very burned out resources.
2. Fast processing and reporting.  Even if it takes only one second to process your data or produce a report, what were the steps or headaches required beforehand?  How many different screens or options do you have to go through before you get to that lightning speed?  Even if there were NO prior headaches and your software is insanely fast, I guarantee if it is too difficult to understand or use after the fact, you'll be grumbling.
3. Reliable information.  Granted, if the information within and generated by your EV software is fraught with errors, you’re going to chuck it out the window pretty quickly.  Most of the time this is caused by “dirty” information going in to the system, or by various settings within the software that affect how the data is processed or reported.  But, let’s say it is doing something to your data—similar to autocorrect or auto-formatting—anything that you don’t want and you can’t turn off….then you’ll be beating your head against a brick wall, because frankly, that will be LESS painful.  This includes putting data in places you don’t want, such as the wrong period or at the wrong level of the WBS.  You’d be surprised how often this happens.  If you hear, “UGH!  Why is it DOING that??!!”, then that’s a good indication that you’ve got an ease of use problem affecting the reliability, or at least the usability of your data.
4. Useful reporting and charts.  Perhaps you desire reports and charts that don’t require some third-party software to generate them.  Eliminating additional software needed because your current EV software doesn’t yield reports you can use is a common reason for wanting new EV software.  But even if it does produce wonderful reports, how easy was it to generate them?  How difficult is it for project managers to access and run a report for themselves?  If you DO need to load it into a third party software, how hard is it to set up the interface, or is it all done manually?

So the next time you go looking for software to make your life easier, make sure it really does make it easier.  I know it sounds like such an intuitive and simple concept, but so many people lose sight of it.  And to help you even further, here is a list of questions you should ask when reviewing potential EV software programs:

• Does it take a small army to setup and run each month?
• Can anyone be trained to use it within one day?
• Is the software so complicated that the developers have created a setup or processing wizard?
• Do you have to enter the same data in more than one place?
• How many manual steps are created or eliminated by this software?
• Are other tools needed to analyze the data in the software, and if so, how many or how often?
• Is the data generated consistent across datasets and does it provide valuable, reliable project performance information?
• How many steps do you have to take to drill down into your data?

Do you have any other tips for finding easy to use EV software?  Or how about complaints of your existing software—how is it not so easy to use?  Check out our blog next time, when we will discuss the "5 Points of Failure for an EVMS."

- Melissa Duncan (About Melissa)

Read the previous posting - Right Sizing: A Common Point of EVMS Failure - Revisions and Data Maintenance"

Subscribe to Blog  

Earned Value legend as there may be a few of us that don’t yet have this memorized…

CA=Control Accounts
CAM=Control Account Manager
CPI=Cost Performance Index
EAC=Estimate At Completion  

EVM=Earned Value Management

EVMS=Earned Value Management System
EAC=Estimate At Completion 

IPMR=Integrated Program Management Report
LOE=Level of Effort
OBS=Organizational Breakdown Structure
OTB=Over Target Baseline
PC=Project Controls
PM=Project Manager
PMB=Performance Measurement Baseline
RAM=Responsibility Assignment Matrix
SPI=Schedule Performance Index
WBS=Work Breakdown Structure