All projects follow a common life cycle. The cycle consists of project proposal, project planning, project execution, and project closeout. In the following sections, we explore these components separately. This article is an excerpt from Deltek’s special edition EVM for Dummies. To download your free copy click here.
The proposal phase is one of the most challenging phases of any project’s life cycle. As soon as a contractor responds to a customer’s request for proposal (RFP), the hard work begins. The quality of a proposal makes a big difference in the competition for the contract. The following traits make for a good proposal:
- Scope, cost, and schedule are clearly defined, along with the tasks that must be accomplished to complete the project.
- All stakeholders are included throughout the estimating process.
- Independent teams are established to review the estimate from scope, cost, and schedule perspectives.
- Estimates are related to past performance, which provides the basis for making additions and subtractions (trade-offs) in the scope, cost, and schedule. This creates what is typically called a basis of estimate (BOE).
- A Work Breakdown Structure (WBS) is created, and the bid is created around it. (For more on the WBS, see Chapter 1.)
- The statement of work (SOW; see Chapter 1) is created and tied directly to the WBS to ensure focus on project scope.
- The proposal plan should address risks and opportunities, because the risk/reward concept will be the foundation for decision making in the project’s execution phase. After the proposal has been negotiated and accepted by the customer, project planning begins.
- The proposal documents are the starting point for planning, so do a thorough job of putting them together. Make sure to keep track of any changes that occur during the negotiation process so that you understand impact on scope, cost, or schedule.
- During the planning stage, the project team solidifies the following artifacts for execution:
- Work Breakdown Structure (WBS)
- WBS dictionaries outlining scope
- Statement of Work
- Integrated master plan (IMP) defining the flow of work
- Integrated master schedule (IMS)
- Performance measurement baseline (PMB)
- Management reserve for unknowns
- Risk/opportunity plan
The PMB is particularly important, because all cost and schedule data will be measured against it. It should include all the work to be performed and the people who will perform that work, as well as a well-defined time-phased budget and schedule. For government contract projects that require EVM, the PMB becomes the basis of an audit known as an integrated baseline review (IBR). The IBR is a joint review by the government and the contractor that assesses whether the plan is realistic and can be implemented. This review is a learning and discovery activity for both parties.
When the plan is complete, work on the project (the execution phase) begins. The schedule provides the structure, specifying what work is to be done and when it must be done. During the execution phase, the project manager has several responsibilities, including the following:
Tracking progress: The project manager measures progress against the PMB to assess what’s happening on the project, such as how much work should have been accomplished compared with how much work has been accomplished.
Analyzing variances: The project manager examines cost and schedule variances to track deviations from the plan.
Estimating completion costs: The project manager routinely estimates the cost of completing the remaining work.
Tracking changes: Change management is a critical element of the execution phase, and the project manager must track all changes that happen during the project. Change management is very challenging, but it yields vital data that can help the plan evolve throughout the execution phase.
When the project is finished (the scope of the project has been delivered in technical terms), the closeout phase begins. Leftover project equipment is disposed of, and final project accounting is performed. On government projects, contractors must follow certain guidelines and requirements for contract closeout.
This article is an excerpt from Deltek’s special edition EVM for Dummies. This book is an excellent first step for any project professional considering the implementation of EVM for the first time. Whether you are a seasoned project manager, a project controls professional or an executive, this eBook will give you practical advice on achieving more from projects and making your EVM journey successful. To download your free copy of EVM for Dummies click here.
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