11 September 2009

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Quick Quiz

By Barbee Davis, MA, PHR, PMP

My organization absorbs costs and doesn’t want me to use change requests when customers add additional scope to my fixed-price projects. I look like an inept project manager, never meeting time and budget projections. How can I accurately track my accomplishments?

A. Refuse to do the extra work for the customer without a signed change request.

B. Separate out time and cost for the mandatory overages and show management.

C. Explain directly to the customer why you and your team can’t include the changes.

D. Find a job at another organization that does not use fixed-price contracts.

Answer: B. Separate out time and cost for the mandatory overages and show management.

It is frustrating to be forced to add extra work to your project after the project baselines are set, especially if your project statistics then show that you are frequently over budget and do not meet your completion deadlines. Not only do you need to document your real accomplishments for performance evaluation and résumé purposes, your team needs to know that they are meeting projected goals to keep their motivation high.

Here is how to honor the organization’s request to add extra features or services that are outside of the original scope and baselines of your customer’s project, without making your team look bad.

Prepare files. Save your original project file. Create a second project file, adding MandatoryOverages to the title, which you will now use to track the project.

Create a separate deliverable. Whether you are tracking the project manually with Microsoft Project^® or using other software tools, create a separate heading entitled Mandatory Overages. You may add subheadings if there are multiple things being requested. Under each heading or subheading, indent the activities that you must add to the project to produce the extra features.

Integrate the new activities. Link these activities into the other project tasks and assign resources to them. Estimate durations and note the new schedule baseline and duration.

Set a new baseline. Manually record or use your automated software to create a new baseline2. Distribute the new baseline that shows the new finish date and the new cost to your internal stakeholders. Track the actual work as you usually do. Now you have a realistic yardstick against which to judge the performance of your team, and yourself as the project manager. These success figures are the ones you can place on a résumé or bring to a performance or team review.

Create an original baseline report. While it is not your responsibility to keep the company from giving away extras, management often does not know the real costs of those “make nice” gifts. After the project is complete, save your completed project file as [projectname]OriginalBaseline. Roll up the activities under the Mandatory Overages heading and remove the heading. The activities will be removed, too. Reset the software to the original baseline. You now can see the actual time and cost of the project had you not been coerced into the additional work.

Create a mandatory overages report. Open your completed project file again, and save it as [projectname]MandatoryOveragesONLY. Roll up the activities and remove all headings (and their activities) except the Mandatory Overages heading and its nested activities. Now you can see exactly how long and costly these additions were.

After a dozen projects or so, show management how much actual time and money was spent on each project over and above the original estimate. Although they may not wish to share the contract amounts and the profit percentages they receive, the amount of money that has been lost in “give-aways” might get their attention. Soon you may find that non-scope features are no longer routinely added for free.

Barbee Davis, MA, PHR, PMP, is a reviewer for the global PMI Registered Education Provider Review Team. She owns Davis Consulting and is a published author, speaker, writer of training materials and an innovator in presentation skill workshops for corporate trainers. She holds a Black Belt in MS Project and teaches at the university level. Her new book, “97 Things Every Project Manager Should Know,” includes practical tips from experienced project managers around the world. Ms. Davis is available for speaking engagements and encourages your questions or comments.