First of all, let me say that i am a strong supporter of Project Management certification.
In my past 16-17 years of project experience, i have seen numerous people go for some or the other form of project management certification (PMP or Prince2 etc) for all the wrong reasons.
Lots of people are looking for the quick and dirty way just to get certified.
There are some people i have come across, who did not want as much to invest in buying the PMBOK (Project Management guide used for PMI's PMP certification)
Then there are those who will only attend a 2 day seminar or a crash course with the sole objective of getting certified and not wanting to actually study and understand what is Project Management all about. (Hopefully the concepts and ideas they gather in the 2 day seminars stay with them throughout their career and they apply the concepts to the projects that they execute).
There are lots of organizations that enforce and encourage certification from their Teams. This is a good practice as this will mould you as a good PM, show you the industry best practices and also help build the organization culture which will definitely lead to better quality and more successful projects (If all Managers are certified and everone follows the same Project Management methodology and practice).
All this makes me think, why do people go for the certification....
Advantages of getting certified
1> Gives you a 360 degree view of Project Management as a practice and how it is used in the overall industry (and other industries), atleast if you are a new comer and do not have enough industry exposure or so far, are only exposed to the Project Management practice silo in your department.
2> Introduces the industry terminologies of Project Management.
3> Provides access to various Templates, tools and techniques, processes that are used in Industry for project execution and management.
4> Introduces and exposes you to a wide spectum of tasks/activities that may be executed in different industry or maybe large budget projects to which you have had no exposures so far.
5> Last but not the least, teaches you that every project is unique. Not matter what your experience and background or skillsets you posess you are bound to come up with scenarios that are unique to your environment and to tackle those you need to be equipped with a PMP toolkit.
Based on points above, Certification definitely enhances and helps your thought process when you are on a project, guides you to the various process areas that you should be thinking all throughout that will help move your project to success, teaches you about risk management, procumement managment and communication management type of activities which you may have not enough exposure.
Wrong reasons to get a Project Management certification
1> Pay increase
- If the individual does not have the inclination to Project Management as a practice, does not value the importance then the certification may lead to some monetary gain in the short term, but will not help you in the long run if the principles learned are not practiced diligently.
2> Career move - Industry recognized certification - so helps me get a better job.
- Some people use PM certification as a success ladder or a career growth opportunity, seeing the certification on my resume, the next recruiter will offer me a better job and better pay package. There is nothing untoward with this in this thought, only make sure you use the knowledge that you have gained in your future job profile just as you have used it on your resume.
3> Everyone else is doing it
- There are definitely some, who go for the certification only because my next door milkman got it....In this case, don't waste your time in getting certified, if you feel it is not a right choice for you.
For those who are seriously interested, i will suggest find a mentor who can guide you about the certification. The internet is a vast resource, gain as much information as you can about the certification, delve on the pros and cons and then take an informed decision. This will benefit not only you, but also the organization where you work.
All in all, i will say, experience and credentials go hand in hand. Having the right cred is important, but nothing like backing it up with your years of experience. For instance, no certification is going to teach you how to excel in Problem solving, People Management, Communications, negotiations, Leadership skills etc. They will provide you with the right tools which you have to nurture and practice and excel in your right......Wish you all new PM certification aspirants all the best
Showing posts with label PMI. Show all posts
Showing posts with label PMI. Show all posts
Wednesday, June 8, 2011
Wednesday, May 25, 2011
Earned Value Analysis
What is Earned Value analysis?
Understanding EVA (Earned value Analysis) is very important for Project success. Earned Value Metrics provide a common set of parameters and benchmarks against which a project progress can be mapped. This is mostly used during the Control and execution phase of the project. The metrics help indicate whether the project is on track or not.
Earned Value Metrics is a set of indicators that help in tracking and measuring certain parameters against a certain baseline which would help us in defining or visualizing whether a project is successful or not.
Advantages:
Along with this, other advantages of using Earned Value Analysis in project management are,
- Accurate reporting of project logistics to PMO and project sponsors
- Early warning to Project Managers so they can take corrective actions by performing risk analysis, if a project starts going over budget or behind schedule
The 2 key elements that guide or help to trend a project are,
- Project Cost
- Project schedule
In order to calculate earned value on any project large or small, first the Project Manager has to define the WBS (Work breakdown structure), define the smallest level of activity schedule and cost and this forms the Project baseline (or planned value) against the project actuals (or AV) can be compared to calculate the earned value variances and indices.
Terminology:
Certain acronyms that will help us in understanding EVM are
PV = Planned Value = The Budgeted amount allocated for a certain scheduled work activity until the current point in time =Also known as Budgeted cost of work scheduled (BCWS)
e.g. For a web based project (say), we need to create a screen
This requires (say) 1 resource for 40 hours (@ $100/Hr), so the PV for this task is $4000 (for 40 hours of work)
AC = Actual Cost = Total Cost for the work that was performed=Also known as Actual Cost of Work Performed (ACWP)
e.g: In the above example assume it took 1 res 10 hours to complete 30% of the work
AC=10*100=$1000
BAC = Budget at completion i.e. Originally budgeted amount for the project i.e baseline cost
e.g. In the above case assume baseline cost is $4000
So based on this, we can track the project performance as follows,
EV = Earned value = BAC*Percent of Project completed=This indicates How much of budget should have been spent for the amount of work done so far.
e.g. EV=4000*0.3=1200
Cost variance = CV = EV - AC = This helps to determine project performance wrt cost/budget
e.g. CV=1200 - 1000 = 200 (NOTE: Positive variance is better than negative)
Schedule variance = SV = EV - PV=This helps to determine the project performance wrt schedule
e.g. SV=1200-4000=-2800 (NOTE: Positive variance is better than negative)
Cost Peformance Index = CPI = EV/AC= This index helps to understand how $ spent performs wrt planned cost
e.g.CPI = 1200/1000=1.2 (NOTE: Index closer to 1 indicates we are closer to baseline)
Schedule performance Index = SPI = EV/PV = This index helps us understand whether we are ahead or behind schedule
e.g. SPI=1200/4000=0.3 (NOTE: Index closer to 1 indicates we are closer to baseline)
Estimate at completion = EAC = AC + (BAC - EV) = Indicates what should be the final cost at any point in the project
e.g. EAC = 1000 + (4000 - 1200) = 3800
Estimate to Complete = ETC = EAC - AC = Indicates how much will it cost you to complete the project based on the current status
e.g. = 3800 - 1000 = 2800
They key concept here is how to calculate the "Value" of the work that is completed. There are various schools of thought to support this
1> Some consider 50% value reached when 50% of work is completed
2> Some consider 30% value reached when 70% of work is completed and then remaining 70% of value is realised when rest 30% of work achieved
3> Some consider 0% value reached till all 100% of work is completed
These metrics provide lot of insight as to the project progress. This can be mapped and managed using simple excel sheets provided we have the baseline calculated. This metrics analysis system will also account for scope, schedule changes and resource change. Those can be fit into the timeline
Understanding EVA (Earned value Analysis) is very important for Project success. Earned Value Metrics provide a common set of parameters and benchmarks against which a project progress can be mapped. This is mostly used during the Control and execution phase of the project. The metrics help indicate whether the project is on track or not.
Earned Value Metrics is a set of indicators that help in tracking and measuring certain parameters against a certain baseline which would help us in defining or visualizing whether a project is successful or not.
Advantages:
Along with this, other advantages of using Earned Value Analysis in project management are,
- Accurate reporting of project logistics to PMO and project sponsors
- Early warning to Project Managers so they can take corrective actions by performing risk analysis, if a project starts going over budget or behind schedule
The 2 key elements that guide or help to trend a project are,
- Project Cost
- Project schedule
In order to calculate earned value on any project large or small, first the Project Manager has to define the WBS (Work breakdown structure), define the smallest level of activity schedule and cost and this forms the Project baseline (or planned value) against the project actuals (or AV) can be compared to calculate the earned value variances and indices.
Terminology:
Certain acronyms that will help us in understanding EVM are
PV = Planned Value = The Budgeted amount allocated for a certain scheduled work activity until the current point in time =Also known as Budgeted cost of work scheduled (BCWS)
e.g. For a web based project (say), we need to create a screen
This requires (say) 1 resource for 40 hours (@ $100/Hr), so the PV for this task is $4000 (for 40 hours of work)
AC = Actual Cost = Total Cost for the work that was performed=Also known as Actual Cost of Work Performed (ACWP)
e.g: In the above example assume it took 1 res 10 hours to complete 30% of the work
AC=10*100=$1000
BAC = Budget at completion i.e. Originally budgeted amount for the project i.e baseline cost
e.g. In the above case assume baseline cost is $4000
So based on this, we can track the project performance as follows,
EV = Earned value = BAC*Percent of Project completed=This indicates How much of budget should have been spent for the amount of work done so far.
e.g. EV=4000*0.3=1200
Cost variance = CV = EV - AC = This helps to determine project performance wrt cost/budget
e.g. CV=1200 - 1000 = 200 (NOTE: Positive variance is better than negative)
Schedule variance = SV = EV - PV=This helps to determine the project performance wrt schedule
e.g. SV=1200-4000=-2800 (NOTE: Positive variance is better than negative)
Cost Peformance Index = CPI = EV/AC= This index helps to understand how $ spent performs wrt planned cost
e.g.CPI = 1200/1000=1.2 (NOTE: Index closer to 1 indicates we are closer to baseline)
Schedule performance Index = SPI = EV/PV = This index helps us understand whether we are ahead or behind schedule
e.g. SPI=1200/4000=0.3 (NOTE: Index closer to 1 indicates we are closer to baseline)
Estimate at completion = EAC = AC + (BAC - EV) = Indicates what should be the final cost at any point in the project
e.g. EAC = 1000 + (4000 - 1200) = 3800
Estimate to Complete = ETC = EAC - AC = Indicates how much will it cost you to complete the project based on the current status
e.g. = 3800 - 1000 = 2800
They key concept here is how to calculate the "Value" of the work that is completed. There are various schools of thought to support this
1> Some consider 50% value reached when 50% of work is completed
2> Some consider 30% value reached when 70% of work is completed and then remaining 70% of value is realised when rest 30% of work achieved
3> Some consider 0% value reached till all 100% of work is completed
These metrics provide lot of insight as to the project progress. This can be mapped and managed using simple excel sheets provided we have the baseline calculated. This metrics analysis system will also account for scope, schedule changes and resource change. Those can be fit into the timeline
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