MGMT 625 Week 7 DB Forum 4 Thread Example

Discussion Board Forum 4: Thread

MGMT 625 Project Planning & Scheduling, Discussion Board Forum 4: Thread

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The prompt and the college's build-out are composites standing in for the course's own forum; Wilson's text, the scholarly sources and Scripture are real; the requirements follow Liberty's public course guide for MGMT 625.

Last year our community college converted part of a vacant classroom wing into a nursing simulation center with six high-fidelity patient rooms, a control room and two debriefing classrooms. The project had a budget of $2.8 million and a planned duration of eleven months, timed so the center would open for the fall semester. In month nine, the status report showed planned value of $2.31 million and earned value of $2.19 million. Dividing the second figure by the first gave a schedule performance index of 0.95. The facilities director told the dean that the project was "about two weeks behind" and that the August opening was safe. The month-six report had shown an index of 0.88, so the trend looked like recovery, and the dean approved the purchase of simulation manikins on the assumption that faculty training could begin in July.

It was not. The cost-based index has a well-known weakness: because all planned work is eventually earned, the index climbs back toward 1.0 in the final months of any project, late or not, so a late project can look nearly on time just when the warning matters most. Vandevoorde and Vanhoucke (2006), comparing methods for forecasting project duration from earned value data, ranked the earned schedule approach ahead of the alternatives for reliability, above all once a project was well along, while forecasts based on the cost-based index lost accuracy as completion approached.

Earned schedule asks a different question: at what point in the plan should we have reached the value we have actually earned? Our plan called for $2.19 million of earned value at about 7.8 months. At an actual time of nine months, the time-based schedule performance index was 7.8 divided by 9, or about 0.87. Dividing the planned eleven months by 0.87 forecast a finish at about 12.7 months, roughly six weeks late, which meant the center would miss the start of the fall semester. It opened in the third week of September.

Lipke et al. (2009) argue that earned value and earned schedule forecasts should be stated with statistical confidence limits, using the variation in the performance indices over time, rather than as single dates. Lipke and his colleagues also stress that late-stage forecasts deserve particular care, since that is when decisions about openings and staffing are made. Had we reported a range, the dean would have seen that even the optimistic end of the forecast missed August, and the college could have planned its first simulation courses for October instead of scrambling to move them. Wilson (2014) treats earned value as a tool for controlling both cost and schedule, and the lesson for me is that the tool controls only as well as the measure chosen.

Paul told the Corinthians that what a master asks of a steward above all is trustworthiness (English Standard Version Bible, 2001/2016, 1 Corinthians 4:2). A faithful steward reports where the project really stands, even when a friendlier number is available. The 0.95 was accurate arithmetic and a misleading message. Our college now reports both indices in every status report after the halfway point, along with the forecast range, so that the people who schedule classes see the time-based picture rather than the cost-based one.

Classmates: which schedule measure do your status reports use, and has it ever told you the project was nearly on time when it was not?

References

English Standard Version Bible. (2016). Crossway. (Original work published 2001)

Lipke, W., Zwikael, O., Henderson, K., & Anbari, F. (2009). Prediction of project outcome: The application of statistical methods to earned value management and earned schedule performance indexes. International Journal of Project Management, 27(4), 400-407. https://doi.org/10.1016/j.ijproman.2008.02.009

Vandevoorde, S., & Vanhoucke, M. (2006). A comparison of different project duration forecasting methods using earned value metrics. International Journal of Project Management, 24(4), 289-302. https://doi.org/10.1016/j.ijproman.2005.10.004

Wilson, R. (2014). A comprehensive guide to project management schedule and cost control. Pearson FT Press.