Chapter 7. Investigate Project Monitoring and Controlling

Monitoring and controlling refers to all the activities and processes necessary to successfully manage a project and its associated risks. For the PMP exam, monitoring and controlling relates to 11 out of the 47 project management processes defined in the PMBOK.

In essence, monitoring and controlling is all the effective activities that a project manager performs to keep project performance and resource utilization at optimal levels. The magnitude and frequency of these activities are dictated by the size and organizational impact of a project. No matter the size of a project, there are three core elements that support effective monitoring and controlling:

Effective definition of the project baseline and milestones

Effective tracking of project activities and resource utilization

Effective risk definition for proposed corrective or preventive actions

The following sections address the various processes associated with monitoring and controlling and how these processes ensure that a project stays on track.

Perform Integrated Change Control—4.5

Validate Scope—5.5

Control Scope—5.6

The monitoring and controlling process group addresses 9 of the 10 PMI knowledge areas, permeating nearly all aspects of a project. The activities in this process group help to prescribe a measured and controlled project execution environment.

Figure 7.1 shows how the process groups of the project management methodology are related. You can see that all of them must be monitored and controlled for effective project completion. Note, however, that Figure 7.1 only shows a single closing iteration. Remember that closing can occur at every phase in a multi-phase project. It doesn’t happen only once in all cases.

Execution trend analysis

Risk trigger management

Forecast reports (like weather forecasts)

Work package progress status and variances reports

Lessons learned from similar projects

Best practices

Corporate strategy committee resolutions

These are some examples of project control processes and their elements:

You could use earned value analysis to determine how your project is performing against the planned activities, schedule, and cost.

You can prescribe corrective or preventive actions after performing trend analysis in work packages variances.

You can identify a potential project change request after evaluating defect and frequency control charts.

When executing enterprise projects, you can arrange a monthly meeting with the company CEO to discuss progress and new corporate initiatives.

As you can see, this process is a high-level process that requires expert judgment on the part of the project manager to assess whether the project is within the constraints of the plan. Any deviations require intervention or requests for changes to the plan.

Table 7.2 shows the inputs, tools and techniques, and outputs for the perform integrated change control process.

After you determine that a proposed change has merit and supports the project objectives, the change request is submitted to the change control board for final determinations. For the most part, the interaction with the change control board is defined in the planning stage and can remain in place until the completion of the project. In the event that the organization has a project management office, the members of the change control board can change to accommodate strategic impact or affected areas in the project organization.

In addition, you should monitor any trends in requested changes that could indicate inadequate requirements definition in the planning stage of your project.

One of the challenges of the traditional linear methodology approaches is that they do not clearly provide methods to incorporate organizational changes midstream and do not verify their range to target impacts. In other words, a project without feedback loops makes the assumption that nothing outside the project will change throughout the life of the project; the requirements will not change or are frozen.

Remember that enterprise changes can have a direct effect on the viability of a project. Some examples of events that you might want to be made aware of in advance are

A hostile takeover

A divestment of a business unit

Personnel or resource availability reduction

A corporate relocation

The validate scope process provides a project manager with a formal process to classify deliverables as acceptable or unacceptable. Table 7.3 shows the inputs, tools and techniques, and outputs for the validate scope process.

One output of the validate scope process is the collection of change requests. These requests are individually addressed through the perform integrated change control process and might result in approved change requests.

The next process in the monitoring and controlling process group is the control scope process. This process monitors and controls all changes to the scope baseline to ensure that the changes are being handled in a structured manner. Table 7.4 shows the inputs, tools and techniques, and outputs for the control scope process.

A primary component of the project management plan is the scope baseline. The scope baseline defines the project scope and its associated deliverables, and it documents the acceptance parameters of the final product. This baseline helps in clarifying any details that might have been left in a to-be-determined (TBD) mode during the project initiation phase or items that require further clarification with the project sponsor or its stakeholders. The project process indicators in this process are

The work breakdown structure (WBS)

Work package progress reports

The idea behind effectively defining the WBS is to create the roadmap that defines all the activities that will be executed to accomplish the project goal.

The WBS is an element that changes with the passage of time and resource utilization. Why? As you perform the tasks outlined in your baseline, the recorded changes accommodate any differences between the planned theory and the actual execution.

An effective WBS assists the stakeholders in understanding the activities and events that help in delivering the project promise, as well as outlining internal and external resource use. The entire project execution team looks at the WBS to inquire about present, past, and future deliverables and their effectiveness.

Due to the nature and importance of the WBS, its creation should not be taken lightly. It must be considered as the one element that all project participants might want to have considered when formulating an opinion.

Control Costs—7.4

Control Quality—8.3

After a project enters the executing phase, work is performed to produce the project’s deliverables. All work should be performed according to the project schedule, budget, and quality standards. But is it? Is the project schedule accurate, and is the work being performed at the planned time? Is the project costing more than planned? Is the quality of the deliverables sufficient? These questions must be answered to keep the project on track. The processes in the time, cost, and quality management knowledge areas ensure that the project stays on schedule and on budget and that the project produces deliverables of the necessary quality.

The control schedule process identifies any departures from the project schedule. What happens if work is falling behind? Your recourse is to implement corrective or preventive actions or a change request to align the project execution with its expected results and timelines.

Some options available at this time could be to

Update the project baseline to reflect the current situation, using the documented change process.

Level resources. When possible, reassign over-allocated resources to avoid schedule conflicts.

Crash the schedule. Add people (internal/external) or resources to the tasks that have fallen behind and have a direct effect on the critical path; the downside is that this might cause unscheduled expenses.

Fast track. Rearrange your activities to perform activities in parallel.

Outsource the project or the affected part.

Reduce the scope of the project.

The second process, control costs, ensures that the work is occurring within the project budget and identifies any variances early in the process. Table 7.6 shows the inputs, tools and techniques, and outputs for the control costs process.

The control costs process identifies any areas that are costing more than planned. As a project moves toward completion, the value of the project’s deliverables changes. The “value” of a project at any point in time is known as its earned value. One method of comparing the earned value of a project to the budget is earned value analysis.

Remember that the whole idea behind a corrective or preventive action is to help preserve the healthy execution of your project and maximize its resource utilization.

The following are some of the items used to measure and keep control of the schedule and cost variances:

The three key variables involved in the project earned value analysis are

Budgeted cost for work scheduled (BCWS)

Budgeted cost for work performed (BCWP)

Actual cost for work performed (ACWP)

To successfully report on earned value management, your project must have a well-defined WBS and an effective task planned versus actual performance reporting system.

A basic utilization example is as follows:

The budgeted cost for work scheduled (BCWS) is the planned value of the work according to the project budget. The BCWS of a project with 12 milestones and 144 work packages is $200,000, and the cost for every 3 milestones has been estimated to be $50,000.

The actual cost for work performed (ACWP) is how much you really have incurred in the project. In this example, you are at milestone 6, and the project has used $80,000; therefore, your ACWP is $80,000.

The budgeted cost for work performed (BCWP) is the value of how much work has been completed. So while your ACWP is $80,000, your BCWP is $100,000.

Armed with this information, you can determine derivative calculations such as the schedule performance index (SPI) and the cost performance index (CPI). In this example, it would be

Ishikawa diagram—This diagram type can be easily identified because it resembles fishbones. It is used to determine the root cause of a defect (see Figure 7.2).

Remember that a product or task defect is a symptom, but not the cause, of the problem. A fishbone diagram is effective in graphically displaying what might be causing a problem at the end of the production line.

Control chart—A control chart is a statistical tool used to identify process points that are outside the normal flow of a process. They help to graphically display process execution boundaries, trending, and overall performance over time (see Figure 7.3).

Pareto chart—Vilfredo Pareto postulated that the distribution of income and wealth follows a regular logarithmic pattern where 20% of the population controls 80% of the wealth. Subsequently in 1937, Dr. Joseph M. Juran adapted Pareto’s economic observations to business applications, which he called the “vital few and trivial many.” Translated to project terms, 80% of the problems are caused by 20% of the activities. This is called the 80/20 rule, and a Pareto chart reflects this rule (see Figure 7.4).

Control Risks—11.6

Control Procurements—12.3

Control Stakeholder Engagement—13.4

The remaining processes in the monitoring and controlling process group provide a project manager with tools and direction for assessing project communication, risk, procurement, and stakeholders. These processes complete the description of how the project manager ensures that the project is operating as intended.

In the normal exchange of information with the stakeholders, the project manager will use methods and techniques that help with formal and informal communication. Formal methods include items such as contracts, status reports, public speeches, and performance appraisals. Informal methods are those such as “the scuttlebutt,” email, and telephone conversations.

With this in mind, it is important to adjust a message and its delivery method based on the audience and the level of impact the project might have on the individuals with whom the project manager is communicating. For example, consider a board member versus the person doing the work. For the worker, getting information about revenue projections and return on investment might be of little or no consequence in her daily duties. However, providing figures on how many additional widgets can be made in an hour would definitely have an impact on her duties and equipment maintenance cycles.

In addition, the project manager must be aware that when delivering a message, nonverbal communication and physical appearance have a direct effect on the message delivered. For example, the project manager delivers a message to a construction team. It’s important to ensure that language and colloquialisms used are appropriate to the group. Bear in mind, though, that the same approach might not work when giving a project update to the company senior team. It is important to ensure that the message and intentions are clearly understood by the audience who is the target of the message.

Examples of common tools used to communicate are a budget, a contract, a teleconference, and a chart.

Table 7.9 shows the inputs, tools and techniques, and outputs for the control risks process.

Remember that to determine how much of an effect a risk will have, you multiply its probability by its material impact. As the probability of risk materialization increases, the risk register should make resource (money, equipment, people, and time) allocations ahead of time, thus increasing reserves. It is also important that the risk management plan include the processes that would replenish these reserves before they become depleted.

The purpose of project risk control is to

Identify the events that can have a direct effect on the project deliverables

Assign qualitative and quantitative weight—the probability and consequences of events that might impact the project deliverables

Produce alternate paths of execution for events that are out of your control or cannot be mitigated

Implement a continuous process for identifying, qualifying, quantifying, and responding to new risks

The risk register accounts for positive and negative risks. A positive risk is a risk that a project takes because its potential benefits are greater than those of the traditional approach. A negative risk is one that could negatively influence the cost of the project or its schedule.

One of the techniques to evaluate risk control and monitoring effectiveness is to compare actual risk resolution practices to those that were planned at the time the risk was identified. Any deviations (negative or positive) would be cause to implement a corrective action in the risk management plan.

Remember that for each identified risk, it is important to provide a response plan. It is not much help if a risk becomes a reality and there is no alternate execution path or emergency procurement plan.

In addition, the risk reserves must be evaluated to determine the best way to replenish them. Some examples of events that could have negative impacts in your risk mitigation and control strategies are

Resource shortage

Scope creep

Contractual issues

Lack of key resources availability

Table 7.10 shows the inputs, tools and techniques, and outputs for the control procurements process.

In general, the project procurements administrator is from the procurement management office and/or legal department and has the authority to issue change requests or early terminations.

Remember that all communications pertaining to procurement administration must follow formal channels and be logged in your project log.

Your procurement administration process should include mechanisms that allow for contract renegotiation, management response, and payment terms definitions.

Table 7.11 shows the inputs, tools and techniques, and outputs for the control stakeholder engagement process.

Although you may see references to stakeholders in the project communications management knowledge area, pay particular attention to the processes in the project stakeholder management knowledge area. Any activities specifically related to interacting with stakeholders are addressed by processes in this knowledge area.