Project Control

At its birth Project Control appeared as an activity aimed to respond to the main questions coming from those who decide to undertake a Project:

• Will the project be completed on schedule?
• Will the project be completed in accordance with the expected costs?

The chance to get answers to these questions can help to limit any states of anxiety but by itself it does not produce any added value if it is not able to influence everyday actions of the people who work on the project.

Even today it happens that PROJECT CONTROL is confused with Cost Accounting (detection of the past) whose economic added value is very poor.

In its most extensive and current meaning Project Control has to be intended as a discipline consisting of:

“"A set of processes that, interacting with each other, are performed in parallel during the entire life cycle of a Project by the entire community interested in implementing it; These processes are designed to promote the research, the identification and implementation of the best solutions to be adopted in order to optimize the overall result”.

Controlled Variables

The ultimate goal of Project Control is to optimize the overall profitability of a Project, therefore the values that should be subjected to a constant control are those relating to all the variables that contribute to determine it.

The variable that, in ultimate analysis, depicts the profitability of a project is represented by the cash flow generated. The primitive variables which lead to the generation of cash flow and therefore need to be planned and controlled throughout its lifecycle are many and are both technical (production volumes and resources used), economical (costs, revenues, turnover, MOL), and financial (Cash in, Cash out).

A further crucial variable which is related to all the others is "time".

Theory and Practice

The theory(usually limited to the "cost" variable) is widely known and treated but is rarely effectively implemented without difficulties.

The practical problems encountered are of different nature and occur at different stages of the lifecycle of the projects:

• What are the entities towards which the technical estimation is carried out?

• What are the entities towards which the Cost Estimating activities are performed?

• What are the entities towards which the Planning, Budgeting and Controlling activities are performed?

• How do you ensure consistency between the values defined by the cost estimating process and the planned values under budget?

• What methodology should be used to place dynamically over time (time phasing) the variables subjected to the planning and control process?

1. valorizzazione delle attività programmate?
2. datazione dei valori previsti?
3. mista?

• What are the entities based on which the Estimate To Complete (ETC) is made;

• What are the methods to be adopted (depending on the different entities planned) to make the Estimate To Complete (ETC)?

• How do you make congruent (synchronous) Actual Values (AV) with the respective values of Estimate To Complete (ETC) to get the correct values of Estimate At Completion(EAC)?

• What are the entities that represent the contact points between the Project Control System and the Enterprise Accounting System?

• …

An informed opinion about the difference between theory and practice has also been expressed by Ginette B. Basak - Past President ICEC (International Cost Engineering Council):

“In a perfect world everything functions as it should.

In real world of project control, the tale is often less than perfect with numerous obstacles and disappointments.

A recent survey confirmed that half of the responding organization are struggling with their project control functions

Experienced project control professionals know “what should be done” to manage and control project successfully. However, simply knowing what should be done is not enough.

Why is there a gap between project control theory and actual practice? And what measure can be taken to eliminate or at least minimize negative impacts? “