What is project control?

What is project control? Well in simple terms, to define project control basically means measuring the key performance indicator of the project against the project plan and approving change requests, including recommended corrective and preventive actions.

Project Control (also known as project monitoring and control) is the toughest aspect of project management where project controllers are expected to know how to control a project that has been planned and managed in a very formal, proper way.

However, in the real world, many project managers ignore the importance of project control and do not deploy a dedicated project controller on their projects. They often think project planning and control are the same things.

There are several project control definition proposed by various project management bodies and project control academy. Some of them are as follows.

According to the PMI’s Project Management Body of Knowledge (PMBOK), project control process is defined as the following: “Project controls are the data gathering, management and analytical processes used to predict, understand and constructively influence the time and cost outcomes of a project or program; through the communication of information in formats that assist effective management and decision making.”

As per the Association for Project Management (APM), Project control is defined as “The application of processes to measure project performance against the project plan, to enable variances to be identified and corrected, so that project objectives are achieved.”

As per AACE Practice Standard, cost control is the application of procedures to monitor expenditures and performance against the progress of projects or manufacturing operations; to measure variance from authorized budgets and allow effective action to be taken to achieve minimum costs.

What are the objectives of project control?

The main objective of the project control process is to monitor the resources, procedures, and tools deployed in a project to complete the work and keep tracking the performance indicator through the project lifecycle.

The high-level objective of project control is to minimize the variance in scope, costs and schedule from the original plan and reduce the risks 

The objective of project control can be defined in details based on the size and type of projects. Many construction project companies have a mix of small and large value projects. Words like ‘small’ and ‘large’ can be relative, but usually, it is categorised based on the value and time scale of the project.

However, this doesn’t mean that you can skip applying project controls to smaller projects – it only means that you should follow a scalable approach to applying the right processes based on the size and complexity of the project.

For a smaller project, the following objective would sufficient.

• • Ability to compare the originally planned budget with actual cost as project progress
  • Ability to compare the origin schedule baseline with the current baseline
  • Ability to track and report on change requests and their effect on project

For larger construction project’s objective would include above plus additional detailed objective like below

• • Ability to use historical projects data as a benchmark to provide feedback to new projects in terms of cost estimates, schedules, plans, etc.
  • Ability to track the real-time progress of the project
  • Ability to defined work in WBS and work packages
  • Establish cost coding and Cost break down structure (CBS)
  • Ability to track real-time tracking of the actual and remaining budget
  • Ability to forecast the remaining cost based on the current project scenario.

What is the importance of project control?

Despite the use of the best project management efforts, process and tools, many organizations fail to meet the project timeline and targets for a number of reasons: optimism bias, manual estimation errors, insufficient historical data, scope creep and many other factors.

Based on the Mckinsey Construction Productivity report, when it comes to large-scale capital projects, 98% of projects incur cost overruns or delays. On average, cost increases are estimated at 80% of the original value, and timelines are often delayed by 20 months or more.

In PwC analysis of capital projects, six nuclear plants observed an average cost overrun of 157%! In another instance, a refinery project eventually overshot its budget from an initial $4 billion to $12 billion.

Based on Logical Project Intelligence Survey, 88% of respondents said they perceive project controls to be important or critical to the success of enterprise projects.

So, what is the difference between a costly, long-overdue project and one that is delivered on time and within budget? In many cases, the answer is good project controls.

The report also confirms the correlation between project controls and success: those that perceived controls as ‘critical’ were twice as likely to meet all project objectives. Those who perceived project controls as ‘not important at all’ were more than 3 times more likely to fail.

There is a humongous amount of report & study which emphasize the significance of project control, especially considering the complex and variable size of projects. Predictability of project cost and schedule KPIs is crucial for the better financial performance of any organization.

So, what are the benefits of Project Control?

Project control is one of the five project management high-level processes: initiating, planning, executing, monitoring and controlling, and closing

While the project activities are being completed, the work performance data are fed into monitoring and controlling to make sure the project is tracking to the baselines in the project management plan.

Projects of all sizes and complexity, experience significant benefits when project controls are properly defined and implemented.

The following are some of the key benefits of project controls:

• • Minimise variance in project costs and schedule
  • Real-time monitoring of project KPIs
  • Increased project predictability for cost and schedule
  • Increased visibility into the financial health of the project at all stages
  • Ability to identify and mitigate project scope creep
  • Use historical projects data as a benchmark to provide feedback
  • Meaningful benchmarking data as ROE (return of experience) for future projects
  • Increased project margins and profit

How does the project control process work on a project?

 So, what does project controls dos? Many people think controlling a project, one just need the know-how to manage schedule or, even worse, that you can simply buy some planning software and successfully control a project.

Project controllers who spend most of their time asking for percentage complete, being unsure if the project will meet its performance measurement baseline, and thinking that an unrealistic schedule should simply be blamed on management.

The control of a project is based on a robust project plan and can only be achieved through an effective cost and schedule control methodology. The development of a suitable project control system is an important part of the overall project management effort and supports the achievement of project objectives.

It has been proven time and again that project performance can be improved if dedicated project controls systems are in place. Good project control practices result in more predictable cost and schedule outcomes through measuring the variances.

If there are variances from the plan that require changes, the change requests are evaluated during the Perform Integrated Change Control process (part of monitoring and controlling) to determine their impact on the project, identify the best options for dealing with them, and decide whether they should be approved or rejected.

Approved changes that doesn’t affect the baseline (such as corrective action, preventive action, or rework) are fed back into executing to be implemented as part of the project work. The implementation of these approved changes should help fix the variance.

For approved changes that require adjustments to the baselines and project management plan, a replanning effort must be completed before the team can start working from the new updated version of the plan and baselines in executing. This replanning the effort is also done as part of the Perform Integrated Change Control process in monitoring and control.

Once the changes to the baseline are identified and the plan is modified, the revised plan is provided to the team in executing, and the project is again executed according to the updated plan and monitored and controlled to the revised baseline. If the project gets so far off the baselines that is requires an analysis of whether the project should continue at all it may move back into initiating for that decision.

Keep in mind that monitoring and controlling is almost certain to involve adding some information to the various project documents and the project management plan.

Not all monitoring and controlling efforts result in the discovery of variance that warrants preventive or corrective action, defect repair, or changes to the baselines or plan. When a project has been planned appropriately, control efforts will largely result in the information that proves that work is being done correctly to plan and that the scope is being produced to the agreed-upon standards and metrics.

Ultimately, when the work is done (or the project is terminated), the projects move into closing.

Does the project control process occur sequentially after execution?

No; it overlaps with other processes.

You could be using monitoring and controlling processes to control the identification of stakeholders, adherence to organizational requirements for project planning, or the creation of baselines and project documents.

Defects could be identified in executing that will require work in executing to fix them, as well as work in monitoring and controlling to decide if the defects require a change to the plan to prevent future rework and delays.

Controlling procurements and dosing procurements can occur simultaneously on projects because some sellers will complete their contractual obligations to the project while others are still producing deliverables.

Make sure in particular that you understand the difference between executing and monitoring and controlling actions because they continually overlap while the work of the project is going on.

The focus of executing is to manage people and work to accomplish the project as planned.

The focus of monitoring and controlling is to make sure the project is progressing according to plan and to approve necessary changes to the plan to meet the organization’s strategic objectives.

Typically, a project controller spends time and focused effort controlling scope, time, communications, risks, etc. Do you do this? These concepts overlap and repeat themselves throughout the project life cycle.

What are the eight-key areas of project control?

Project control deals with many parameters, such as quality, scope, etc., with a main focus on the cost and schedule factors, continuously monitoring for any risk to them.

The project control process unified part of a successful project management process. It alerts project team members about the potential areas of concerns and facilitate preventive or corrective measures as required. For a successful project control, the project controller needs to deployed on the project from initiation till completion of the project.

Project controls activities must be performed throughout the complete project life cycle—from the initiation phase until project closure.

During this process mainly eight key areas are under focus by the project controller to identify the and variation w.r.t project baseline.

• • Scope
  • Schedule
  • Cost
  • Quality
  • Communication
  • Risk
  • Procurements
  • Stakeholder engagements

How do you monitor and control a project?

Project control is a continuous process during which work performance data, report & variances are analysed. If there are variances from the plan that require changes, the change requests are evaluated and approved.

 Once the changes to the baseline are made, the revised plan is provided to the execution team for work. As per the updated plan project is monitored and controlled as per the revised baseline.

During monitoring and cost and cost control that controllers interact with the project manager, finance team, vendors, construction manager, procurement team engineering team, contract team, quality team and risk management team.

Following are the typical activity list that project controller performs in the various area throughout the project life cycle.

Control Scope

• • Follow the change management plan.
  • Measure scope performance against the baseline.
  • Influence the factors that cause changes.
  • Control scope changes and the impacts of those changes.
  • Analyse work performance data and variances.
  • Request changes.
  • Update the scope baseline
  • Validate changes – do not over-or under correct the problems.
  • Document lessons learned.

Control Schedule

• • Follow the change management plan
  • Measure the schedule performance against baseline
  • Influence the factors that cause changes.
  • Control schedule changes and the impact of those changes
  • Analyse work performance data and variances.
  • Request changes
  • Update the schedule baseline

Control Costs

• • Follow the change management plan.
  • Measure cost performance against the baseline.
  • Influence the factors that cause changes.
  • Control cost changes and the impacts of those changes.
  • Analyze work performance data and variances.
  • Request changes.
  • Update the cost baseline
  • Document lessons learned.
  • Manage the budget reserve.
  • Use earned value analysis to recalculate the estimate at completion
  • Obtain additional funding when needed.
  • Validate changes – do not over-or under correct the problems.

 Control Quality

• • Hold periodic inspections.
  • Ensure the deliverables are meeting the standards.
  • Influence the factors that cause changes.
  • Request changes or improvements to work and processes.
  • Make decisions to accept or reject work.
  • Evaluate the effectiveness of implemented changes.
  • Reassess the effectiveness of project control systems.
  • Analyze work performance data and variances.
  • Update the quality management and process improvement plans
  • Validate changes – do not over-or under correct the problems.
  • Document lessons learned.

 Control Communications

• • Ensure information is being communicated to the appropriate people in the right way and at the right time.
  • Analyze work performance data and variances.
  • Update documentation related to performance reports, and issue logs.
  • Analyze information about communications to meet stakeholder needs.
  • Document lessons learned.
  • Validate changes – do not over-or under correct the problems.

 Control Risk

• • Reassess risks, planned risk responses and risk reserves
  • Identify new risks
  • Use the risk management procedures
  • Create and implement the workaround
  • Evaluate the effectiveness of risk response plan and risk process
  • Analyse work performance data, report and variance
  • Perform risk audits.
  • Identify risks and update response plans.
  • Document lessons learned.

 Control Procurements

• • Monitor performance to make sure both parties to the contract meet contractual obligations.
  • Inspect and verify the contract deliverables.
  • Protect your legal rights.
  • Follow the defined procurement management procedures
  • Analyze work performance data, seller reports, and variances.
  • Request and manage changes.
  • Authorize contract-related work.
  • Issue and review claims.
  • Maintain comprehensive records.
  • Report on seller performance compared to the contract.
  • Review invoices and make payments.
  • Update the project management plan and procurement documentation.
  • Validate contract changes, control to the updated version, and evaluate the effectiveness
  • Document lessons learned.

 Control Stakeholder Engagement

• • Analyze work performance data and variances.
  • Evaluate stakeholder engagement and stakeholder relationships.
  • Assess whether stakeholders’ expectations are aligned with the project.
  • Resolve conflicts.
  • Maintain an issue log.
  • Update the stakeholder management plan and the stakeholder register.
  • Document lessons learned.
  • Validate success of changes to a stakeholder engagement strategy.

What are the main project control KPIs?

Project KPIs are measurable indicators that help to track a project’s performance. To ensure that projects get completed on time and within the approved budget, project controllers need to monitor these KPI.

Planned Value (PV)

As per the PMBOK Guide, “Planned Value (PV) is the authorized budget assigned to work to be accomplished for an activity or WBS component.”

The budgeted amount through the current reporting period. The planned value is the estimated cost for your project activities planned/scheduled as of reporting date. This metric is also referred to as the Budgeted Cost of Work Scheduled (BCWS).

Planned Value = (Planned % Complete) X (BAC)

Actual Cost (AC)

As per the PMBOK Guide, “Actual Cost (AC) is the total cost actually incurred in accomplishing work performed for an activity or WBS component.”

The Actual Cost KPI is also referred to as the Actual Cost of Work Performed (ACWP).

It indicates how much money you have spent on a project as to date. There’s no formula for calculating the project’s actual cost, you just have to add up all the project-related expenses you’ve used to date.

Earned Value (EV)

As per the PMBOK Guide, “Earned Value (EV) is the value of work performed expressed in terms of the approved budget assigned to that work for an activity or WBS component.”

This KPI is also referred to as the Budgeted Cost of Work Performed (BCWP).

This project KPI shows the approved budget for all the performed project activities by a specified date. It shows how much-planned work you have actually accomplished and what’s the budget for these accomplishments.

Earned Value = % of completed work X BAC (Budget at Completion).

Return on Investment (ROI)

The project’s ROI reflects on its profitability and shows whether the benefits of the project exceed its cost. ROI helps you quantify project value and gauge an investment’s profitability.

ROI = (Gain from investment minus the cost of investment) divided by the cost of investment.

Cost Variance (CV)

It indicates whether the estimated cost of your project is below or above the planned baseline. When measuring the Cost Variance, you can easily notice whether you’re beyond or above your approved budget.

Cost Variance = Earned Value – Actual Cost

Cost Performance Index (CPI)

CPI measures the value of work completed against the actual cost. A CPI value <1.0 indicates costs were higher than budgeted. CPI >1.0 indicates costs were less than budgeted.

Cost Performance Index (CPI) calculation: CPI = EV/AC

Schedule Variance (SV)

Schedule Variance shows how much ahead or behind of planned budget (and scheduled work), your project is running.

Schedule Variance (SV) = EV–PV

Schedule Performance Index (SPI)

This project management KPI will tell you whether you’re ahead or behind the planned project schedule. It’s similar to many previous KPIs, except that the value of this metric is always close to number one.

Schedule Performance Index (SPI) calculation: SPI = EV/PV
SPI measures progress achieved against progress planned. An SPI value <1.0 indicates less work was completed than was planned. SPI >1.0 indicates more work was completed than was planned.

Project Control vs Project Management  Are they the same things?

Project management is the application of knowledge, skills, tools, and techniques to project activities to meet project requirements. Project management is accomplished through processes, using project management knowledge, skills, tools, and techniques that receive inputs and generate outputs.

Project management is an integrative undertaking. Project management integration requires each project and product process to be appropriately aligned and connected with the other processes to facilitate their coordination. These process interactions often require trade-offs among project requirements and objectives.

Project management is an overall function that involves managing people, processes and deliverables in a project through various project management process. Project management consists of five high-level processes: initiating, planning, executing, monitoring and controlling, and closing

Project control is one of the five project management process performed to observe project execution so that potential problems can be identified in a timely manner and corrective action can be taken, when necessary, to control the execution of the project.

The key benefit of project control is that project performance is observed and measured regularly to identify variances from the project management plan. It also includes controlling changes and recommending preventive action in anticipation of possible problems.

This continuous monitoring provides the project team insight into the health of the project and highlights any areas that require additional attention. Project control not only monitors and controls the work being done within a Process Group but also monitors and controls the entire project effort.

What are project control techniques?

Project initiation and planning is the most important phase of any project. How you choose to plan your work and set up the processes will dictate the project success.

As you know, at the beginning to end of any project, there are so many unknown variables that it’s easy to feel submerged in an ocean of chaos. That is why you would need special techniques to augment your project control process. They will guide you throughout the project lifecycle and make sure your smooth project journey.

There are plenty of project control techniques. You may not all the technique in your every project. Depending on your project type, complexity and team, you’ll choose some of the following.

The following techniques can be implemented and used to manage and control a project from initiation to successful completion.

Work Breakdown Structure (WBS)

It is always advisable to break a big project into smaller chunks of tasks to verify the progress.WBS transforms big project activities into chunks of manageable tasks you and your team can easily understand and complete. From a control perspective, if your work packages are scheduled to complete within one reporting periods, it is much easier to detect a delayed or troubled task.

Cost Breakdown Structure (CBS)

A Cost Breakdown Structure (CBS) is a breakdown or hierarchical representation of the various costs in a project. CBS represents the costs of the components in the Work Breakdown Structure (WBS).

Gantt Charts

Gantt chart is a bar chart that provides a visual view of tasks scheduled over time. A Gantt chart is used for planning projects of all sizes, and it is a useful way of showing what work is scheduled to be done on a specific day. It can also help you view the start and end dates of a project in one simple chart.

You’ll be able to see task dependencies, how long each task will take, as well as how its duration will affect the start dates and deadlines.

Critical Path Method (CPM)

The critical path method is a schedule network analysis technique that is performed using the schedule model. The critical path method calculates the theoretical early start and finish dates, and late start and finish dates, for all schedule activities without regard for any resource limitations, by performing a forward pass analysis and a backward pass analysis through the project schedule network paths.

Baselines

A fundamental control principle is to first, establish a cost and schedule baseline. Then, measure and report performance against these baselines and maintain it. Budget updates are changes to an approved cost baseline. These values are generally revised only in response to approved changes in the project scope.

Status Meeting

Rhythmic and regular status meetings help to keep everyone accountable, sincere, and on their toes—especially if assignments are specific and have clear finish criteria.

Completion criteria

Communicating a clear and transparent work completion criterion upfront increases productivity and avoids many of the issues associated with status reporting on tasks.

Gate Reviews

Gate reviews provide management specific points in the project life cycle when further progress entails higher investment and commitment. At the Gate Review the project controller reviews progress made to date, changes since the last Gate Review, and the plan for the work between this Gate and the subsequent Gate.

Milestones and checkpoints

Milestones and checkpoints are important points to stop, report progress, review key issues, confirm that everyone is still on board, and verify that the project should proceed with its mission.

Requirement Traceability Matrix

A technique to help control both scope and expectations is the use of a requirements traceability matrix. The traceability matrix provides a documented link between the original set of approved requirements, any interim deliverable, and the final work product.

Formal sign-offs

Manage expectations between the project team and other stakeholders. This also allows space for additions or changes while keeping original communication clear. This helps in maintaining ultimate accountability for each stage of the project. Also, it keeps the expectations aligned and minimize potential disputes.

Independent QA Audit

 The use of an independent third-party agency for quality assurance audit.

 “V” Method

The “V Method” is a term used for the validation and verification approach. The project controller is involved in the validation and verification step for every project deliverable.

What are project control documents?

The strengths of project, controls lie in their data-focused approach and attention to detail. Project controls are the project analytic centre related to project performance KPI and other control documents.

Recommendations and report from the project analytic centre should be based current scenario of the project, facts and reliable data. This is why it’s essential to build effective, simple and actionable reports on a regular basis.

Here are a few reports that help the project controls team should generate on regular basis.

Cost Report

A status report on actual cost, estimate at completion (EAC)and coast variations.

Change Management Register

Keeps track of the change in scope from the initial statement of work or estimate.

Risk Register

Manages risks and records contingency cost associated with known risks.

Project Schedule

A schedule is a listing of a project’s milestones, activities, and deliverables, usually with intended start and finish dates.

Look ahead report

It gives the details of the activities that are to be completed in the foreseeable future – say next 2 weeks.

Project Communications Plan

How important information will be communicated to stakeholders. Who will be receiving what type of communication and how they will receive it at what frequency?

Lessons Learned Register

It is used to record knowledge gained during a project so that it can be used in current and future projects.

RACI Matrix

It is a responsibility assignment chart that maps out every task or key decision involved in completing a project and assigns which roles are Responsible for each action item, which personnel are Accountable, and, where appropriate, who needs to be Consulted or Informed.

Project Charter

A project charter is a formal, typically short document that describes projects objectives stakeholders.

What does the project control manager do?

The project control manager is a key member of the project team and works directly with the project manager to help define the project’s goals and objectives; create and maintain a project’s budget and schedule, analyse progress reported against the work schedules; and recommend actions to improve progress.

In order to ensure accurate documentation and reporting on a consistent basis, many organisations are positioning the project manager and project controller as part of a centralised project support organisation.

On a day-to-day basis, Project Control Manager perform the following tasks

• • Analysis and Reporting – Analyse and report data that can be used as preventive or corrective actions on the project
  • Performance Management – Identifying trends and projects the deviations and recommend corrective actions.
  • Baseline Management – Developing and managing baselines.
  • Schedule Control – Identifying, applying and assessing the schedule variances, monitor projects progress and resources.
  • Cost Control – Identifying, applying and assessing the variations in project cost
  • Quality Control – Identifying, applying and assessing the quality controls to support the management of project quality.
  • Risk Control – Identifying, applying and assessing the
  • Change Control – Identifying and putting in place procedures scope change.

The Project Controls Specialists who know both planning/scheduling and cost control functions are able to identify and manage potential variations from the budget and schedule by integrating the two and looking at the bigger picture.

On the bigger portfolio of projects, several project controllers are deployed on different projects. These project controllers are managed by a project control manager. Sometimes the team of project control manager & project controllers is also known as the project controller group.

What are the project control software?

Project Control involves the regular review of metrics and reports that will identify variances from the project baseline. The variances are determined by comparing the actual performance metrics in the Execution phase against the baseline metrics assigned during the Planning phase. These variances are incorporated into control processes to evaluate their meaning.

As with many technical disciplines, project controls is packed with a range of both practical and theoretical formulas and processes that serve the purpose for the broad range of projects that it can be applied on.

In the past, it may have been acceptable to use manual methods to assess and publish project metrics. But these days, it’s critical to use automated reporting and algorithm-based software or tool to fully utilise the available project data in a timely manner.

The project control software can perform a lot of tasks simultaneously, and produce real-time reports in milliseconds – reports that may otherwise take days if done manually.

However, remember that the information you get out of it is only as good as the information you key in the system.

Despite there is highly technical and advanced software available in the market, an organization will still need to put the processes, discipline and operating rhythm in place. Defined procedures & process will further ensure the quality of input and output information meet the organization standards. These internal processes would make sure that the right technology is being set up and the tool is being utilized correctly.

Key benefits of Project Control software

• • Time-phase of the project budget as per the project schedule
  • Realtime progress measurements at pre-defined points
  • EVM metrics at all levels of the Work Breakdown Structure
  • Produce cash flow and cost forecast reports over a timeline
  • Perform productivity reports such as Hours/unit completed
  • Plan and report on a collection of projects as a Program or portfolio
  • Timeline curves like S-Curve, Resource Curves, Spend Curves

Three components for successful project control

Project Control tools centralize all data and allow users to track progress, assign tasks, and give speedy feedback easily. This software helps project managers, teams, and individual contributors to complete tasks, organize client requirements and manage time, budget, and scope constraints very efficiently. It plays a crucial role in project monitoring & controlling.

However, acquiring project control software does not guarantee successful project control. A successful project control would need a good team of experts and an optimized operating procedure set by the organization.

The combination of people, process and tool application benefits the organization to successfully control and monitor their projects. Any organization that wants to stay ahead of the competition needs to have the right people, process and tools. All three together.

Summary

Project Controls are the data gathering, data management and analytical processes used to predict, understand and constructively influence the time and cost outcomes of a project or programme; through the communication of information in formats that assist effective management and decision making.

The main objective of the project control process is to monitor the resources, procedures, and tools deployed in the project and keep tracking the performance indicator. Project control deal with many parameters, such as quality, scope, etc., with a main, focuses on the cost and schedule factors.

Project KPIs are measurable indicators that help to track a project’s performance. To ensure that projects get completed on time and within the approved budget, the project controller needs to monitor these KPI.

Project control is one of the five project management processes performed to observe project execution so that potential problems can be identified in a timely manner and corrective action can be taken, when necessary, to control the execution of the project.

You would need special techniques & software for the project control process. These tools will guide you throughout the project lifecycle. The project control software can perform a lot of tasks simultaneously, and produce real-time reports in matter of few seconds.

Last but not the least, a successful project control process would need the right people, the right process and the right tools at the same time.

Now tell me, What’s the biggest thing you’re struggling with project control right now that I can help you with? Let me know by leaving a comment below right now.

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