Chapter 2

Project Control

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 Overview
• Project Control Elements
• Project Control Processes
• Post Control Report
• Controlling Change

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 Purposes of Control
• There are two fundamental objectives of control:
1. The regulation of results through the modification of
activities
2. The steward ship of organizational assets
• The project manager needs to be equally attentive to
both regulation and conservation
• The project manager must guard the physical assets of
the organization, its human resources, and its financial
resources

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 Project Control

• Control is the last element in the

implementation cycle of planning-monitoring-
controlling
• Control is focused on three elements of a
project Performance

– Performance
– Cost
Cost Time
– Time
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 Controlling Performance

• There are several things that can cause a project’s

performance to require control:
– Unexpected technical problems arise
– Insufficient resources are available when needed
– Undefeatable technical difficulties are present
– Quality or reliability problems occur
– Client requires changes in specifications
– Technological breakthroughs affect the project

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 Controlling Cost

• There are several things that can cause a project’s

cost to require control:
– Technical difficulties require more resources
– The scope of the work increase
– Initial bids were too low
– Reporting was poor or untimely
– Budgeting was inadequate
– Corrective control was not exercised in time
– Input price changes occurred

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 Controlling Time
• There are several things that can cause a project’s
schedule to require control:
– Technical difficulties took longer than planned to resolve
– Initial time estimates were optimistic
– Task sequencing was incorrect
– Required inputs of material, personnel, or equipment were
unavailable when needed
– Necessary preceding tasks were incomplete
– Customer generated change orders required rework
– Governmental regulations were altered
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 Physical Asset Control

• Requires control of the use of physical assets

– Concerned with asset maintenance, whether preventive or
corrective
– Also the timing of maintenance or replacement as well as the
quality of maintenance
– Setting up maintenance schedules in such a way as to keep the
equipment in operating condition while minimizing interference
to ongoing work
– Physical inventory whether equipment or material must also be
controlled

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 Human Resource Control

• Stewardship of human resources requires

controlling and maintaining the growth and
development of people
• Projects provide fertile ground for cultivating
people
• Because projects are unique, it is possible for
people working on projects to gain a wide range
of experience in a reasonably short period of
time

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 Financial Resource Control

• The techniques of financial control, both

conservation and regulation, are well known:
– Current asset controls
– Project budgets
– Capital investment controls
• These controls are exercised through a series of
analyses and audits conducted by the
accounting/controller function

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 Financial Resource Control
• Representation of the accounting/controlling function on
the project team is mandatory
• The parent organization is responsible for the
conservation and proper use of resources owned by the
client or charged to the client

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 Three Types of Control Processes

• Decisions must be made concerning:

– At what points in the project will control be
exerted
– What is to be controlled
– How it will be measured
– How much deviation will be tolerated
– How to spot and correct potential deviations
before they occur
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 Three Types of Control Processes

• No matter what the purpose in controlling

a project there are three basic types of
control mechanisms that can be used:
– Go/no-go control
– Post control
– Cybernetic control is a third, but less
common PM control mechanism
• Sensor(s)-based Feedback Loop

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 Go/No-go Controls
• Take the form of testing to see if some specific
precondition has been met
• Most of the control in project management falls into this
category
• This type of control can be used on almost every aspect
of a project
• Go/no-go controls operate only when and if the
controller uses them

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Information Requirements: Go/no-go Controls

• The project proposal, plans specifications, schedules and

budgets contain all the information needed to apply
go/no-go controls to the project
• Milestones are the key events that serve as a focus for
ongoing control activity
• These milestones are the project’s deliverables in the
form of in-process output or final output

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 Go/No-go Controls
• Response to go/no-go controls tends to be neutral or
negative
• “Barely good enough” results are just as acceptable as
“perfect” results
• The system makes it difficult for the worker to take
pride in high quality work because the system does
not recognize gradations of quality.

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 Postcontrol
• Postcontrols are applied after the fact
• Directed toward improving the chances for future
projects to meet their goals
• It is applied through a relatively formal document that
contains four distinct sections:
– The project objectives
– Milestones, checkpoints, and budgets
– The final report on project
– Recommendations for performance and process
improvement
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 Postcontrols
• Postcontrols are seen as much the same as a report card
• They may serve as the basis for reward or punishment,
but they are received too late to change current
performance.

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 Cybernetic Controls
• Human response to steering controls tends to be
positive
• Steering controls are usually viewed as helpful rather
than a source of unwelcome pressure
• Response to steering controls also depends on the
acceptance that the goals of the control system are
appropriate

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 Characteristics of a Control System
• A good control system:
– Should be flexible
– Should be cost effective
– Must be truly useful
– Must satisfy the real needs of the project
– Must operate in a timely manner

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 Characteristics of a Control System

• A good control system (cont.):

– Should be as simple as possible
– Should be easy to maintain
– Should be capable of being extended or otherwise altered
– Should be fully documented when installed
• the documentation should include a complete training program in
system operation

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 Control Systems
• All control systems use feedback as a control process
• The control of performance, cost, and time usually require
different input data:
– Performance - engineering change notices, test results, quality
checks, rework tickets, scrap rates
– Cost - budgets to actual cash flows, purchase orders,
absenteeism, income reports, labor hour charges, accounting
variance reports
– Schedule - benchmark reports, status reports, networks, earned
value graphs, Gantt charts, WBS, and action plans

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 Control Tools
• Some of the most important tools available for the
project manager to use in controlling the project are
variance analysis and trend projection
• A budget plan or expected growth curve of time or cost
for a certain task is plotted
• Actual values are plotted as a dashed line as the work is
actually finished
• At each point in time a new projection from the actual
data is used to forecast what will occur in the future

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 Critical Ratio Control Charts

• The critical ratio is made up of two parts:

– The ratio of actual progress to scheduled progress
– The ratio of budgeted cost to actual cost
• The critical ratio is a good measure of the general
health of the project
• By combining two ratios, it weighs them equally,
allowing a “bad” ratio to be offset by a “good” ratio

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 Critical Ratio
Task Actual Scheduled Budgeted Actual Critcal
Number Progress Progress Cost Cost Ratio

1 (2 / 3) X (6 / 4) = 1.0

2 (2 / 3) X (6 / 6) = .67

3 (3 / 3) X (4 / 6) = .67

4 (3 / 2) X (6 / 6) = 1.5

5 (3 / 3) X (6 / 4) = 1.5

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 Benchmarking
• A recent addition to the arsenal of of project
control tools is benchmarking
• Benchmarking makes comparisons to “best in
class” practices across organizations
• Some successful organizations have been
benchmarked on their best practices and key
success factors for projects being conducted in
functional organizations
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 Best Practices and Keys to Success

• There were four major areas found to help

projects in functional organizations:
– Promoting the benefits of project management
– Personnel pay for project management skills and
high risk projects through bonuses, stock options,
and other incentives
– Methodology
– Results of project management

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 Control as a Function of Management
• The purpose of controlling is always the same: to bring
the actual schedule, budget, and deliverables of the
project into reasonably close congruence with the
planned schedule, budget, and deliverables

• The job of the project manager is to set controls that

will encourage those behaviors that are deemed
desirable and discourage those that are not

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 Control of Creative Activities
• The more creativity involved, the greater the degree of
uncertainty surrounding outcomes
• Too much control tends to prevent creativity
• Control is not necessarily the enemy of creativity, nor does
creative activity indicate complete uncertainty of
• There are three general approaches to control creative
projects:
– Progress review
– Personnel reassignment
– Control of input resources

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 Progress Review
• The progress review focuses on the process of
reaching outcomes rather than on the outcomes
• The process is controllable even if the precise results
are not
• Control should be instituted at each project milestone
• The object of control is to ensure that the research
design is sound and is being carried out as planned or
amended

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 Personnel Reassignment

• This type of control is straightforward - individuals

who are productive are kept
• Those who are not, are moved to other jobs or to
other organizations
• While it is not difficult to identify those who fall in
the top and bottom quartiles, it is usually quite hard
to make clear distinctions between the people in the
middle quartiles

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 Control of Input Resources

• The focus is on efficiency

• The ability to manipulate input resources carries with
it considerable control over output
• Considerable resource expenditure may occur with no
visible results, but suddenly many outcomes may be
delivered
• The milestones for application of resource control
must be chosen with great care

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 Control of Change and Scope Creep
• Coping with changes and changing priorities is perceived
as the most important single problem facing the project
manager
• The most common changes are due to the natural tendency
of the client and project team members to try to improve
the product or service
• The later these changes are made in the project, the more
difficult and costly they are to complete
• Without control, a continuing accumulation of little
changes can have a major negative impact on the project’s
schedule and cost
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 Control of Change and Scope Creep
• The project manager’s best hope is to control the process by
which change is introduced and accomplished
• This can be done with a formal change control system that is
able to:
– Review all requested changes and identify all task impacts
– Translate those impacts into project performance, cost, and schedule
– Evaluate the benefits and costs of the requested changes
– Accept or reject the changes and communicate to all concerned
parties
– Ensure that changes are implemented properly

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