Why Project Controls?

Why Project Controls

First of all, Project Controls is so much more than just scheduling.

Project Control is a key factor in ensuring that business and project objectives are achieved through the provision of accurate and efficient information. Project Controls encompasses planning, scheduling and cost control activities; focused on providing independent, objective, accurate, efficient and reliable information.

Project Controls will add value at least in the following areas:

Cost Control
  • Project Controls provides up-to-date and current information on cost commitments and incurred costs tracked against progress vs forecast. (Note: Accounting provides a partial picture of the current status. Accounting information is time lagged and does not include Project/Product Knowledge.)
  • Cost information cannot be taken into consideration alone - progress information is required in terms of material quantities, activities fulfilled, expended hours compared to the Project Execution Plan, Project Budget Baseline (Estimate) and Schedule. (See Earned Value Analysis)
Forecasting
  • Use Project Controls to forecast costs at completion and compare current costs to the reference baseline.
  • Do not rely on mathematical formulas to generate forecasts consider:
    • Labour
      • Current and forecasted labour - man-hours multiplied by rate
      • Current and forecasted staff - staff rate per person by staff employed 
    • Construction Equipment
      • Current and forecasted equipment schedule (include rental equipment)
    • Sub-Contracts
      • List by each sub-contract
      • Include contract value and all sub-contract change orders
      • Pending sub-contract change orders
      • Anticipated sub-contractor claims (if any)
    • Materials
      • Maintain a PO list of all purchased material
      • Use drawings to validate what materials have been purchased and what still need to be purchased
Earned Value Analysis
  • “Earned Value Analysis” is an industry standard way to :
    • measure a project’s progress,
    • forecast its completion date and final cost, and
    • provide schedule and budget variances along the way.
  • By integrating three measurements, it provides consistent, numerical indicators with which you can evaluate and compare projects.
  • EVA compares the PLANNED amount of work with what has actually been COMPLETED, to determine if COST , SCHEDULE, and WORK ACCOMPLISHED are progressing as planned.
Change Control
  • Change will occur many due to events that are external to the project. The major reason for cost overruns and schedule delays is failure to track and recognize changes from the original scope. The challenge is to manage these changes by identification of cause, possible impact, including risk and cost on the project.
  • Management of Change should include:
    • Change Logs of all approved and pending change orders
    • Track contract value against approved change orders
Scheduling
  • Continually updated with Variance Analysis
In conclusion, implementing Project Controls and investing in skilled professional project control specialists is the eyes and ears of management and critical to the success of any project. Management depends on timely and accurate information such as project status, forecast and recommendations. It is Project Controls which is independent of the Project which provides this most useful information.