Project Management Articles
Earned Value Case Study
By Michael Turner
26 Oct, 2007 - 6:05:07 PM

It's good sometimes to bring in an outside resource to review your projects or that one troublesome project for compliance. This is where I come in; having skills in this area I am also impartial and come with a number of tools.

One particular project (refurbishing boilers at a processing plant), the budget for the first boiler (they needed to do 4) was $7 million, management were concerned by the lack of visibility, and a funny feeling that it just wasn't right, but reports said it was ok (oh my goodness you should have seen the reports), they took a full time resource 7 days a week to manage, - for a $7 mil project what's the world coming too - whoops I'm drifting, anyway I started from scratch and analysed the project using techniques from the earned value analysis stable, took me a week, but at the end of that period, I had a prediction, that if they did not address the situation the budget would blow out to $12.1 mil and the scheduled delivery would extend by 2 months, unless they did something about it.

That's the point of these predictions, if you don't do anything about it and carry on as you are currently working - this is what will happen. Anyway as it turned out I'd just advised management at the refinery that their project was going to blow out by 35%, and in the process left my Earned Value Program with them so they could monitor from their on with the procedure.

The Engineering and Maintenance Manager was very concerned, not just for this boiler but for the 3 others that had to be done as separate sequential stages.

There followed reviews over the next few weeks, I was gone by this stage, the project manager the earned value system was obviously floored (or I was)as - it's all under control -. The vendor had assured him of that, I suspect the CEO was prepared to pay to prove scenario was right, so he said OK carry to the Project Manager, but on-your head.

I kept in touch and was both pleased from one perspective and disappointed from another, but by the time the first boiler was completed the cost had blown out to $12.3 mil and the schedule overrun by 2 months.

They used my model and guidelines for the other 3 boilers and they all came in on time and on budget - Oh did I tell you they also had a different PM, anyone out there need a Project Manager without a head?

For more details contact me here