:AACE CERTIFICATION 2009-2010:

Hi All,
Here I am for my week#6 blogs. I want to share an issue where I faced of within this week in my daily work. Still about my current projects the structural refurbishment project.

I am now close to the completion of the project which I need to carefully monitor my EAC now. Probably some of you will think. Why do I aware to “carefully” monitor EAC just now? Is it monitored previously or not?. Or probably just realize that you will close to spending or over spending?.
Let me tell the whole story here. The capital spending in my company allows PM to spend project expenditure within 95-103% without preparing Project change request – PCR. Less or more that we need to raise PCR and get approval from management.
I do monitor my EAC in regular basis along reporting period. The EAC was calculating by actual project + the committed transaction. The committed transaction are come from contract value, purchase order, material issue requisition and seconded engineer invoices, consultant invoices, accommodation, etc.
Sometimes I review my project cost at EAC during reporting duration, I will figure out a “surprising” EAC value. Last 2 months I found the expenditure still OK (even tendency 90% budget); But at this monthly I see big changes which put me in worried ‘cause it close to approved value while I still small committed scope behind.
Try to find the problem with the project control, and we found that the actual and the committed value in our ERP is not “real time”. In the other word is not update as fast as my requirement for decision. This is an issue of DECISION MAKING INFORMATION SUPPORT- during project execution.

The refurbishment project is quite unique which I think it is more like an operation and maintenance work, it is really high level scope, and run the expenditure as per actual finding during execution. But the management want me to run it as a project; a clear scope, within time and budget. The scope of work is just selected list of equipments on the plant, but the actual repair works are measure on field by inspection. The simplied step by steps as follow:
1.Contractor prepare inspection access (scaffolding, propping etc)-for this activity contractor charges as al lump sump prices.
2.Perform inspection and identify defect with the engineer
3. Engineer prepare repair sketch with calculated estimate tonnage per repair point,
4. Contractor perform installation as per repair sketch
5. Engineering approve the QC and accept the work.
6. Payment claimed by contractor.

The agreed contract with the contractor is combination of lump sump (for step 1 above) and unit rates (for step 4). The Challenges for me as a PM, I will never know the quantity of actual repair work (tonnage) at every equipment until it’s inspected (as per step no.2).
So almost every day I will face up with milestone of DECISION MAKING within “proceed or not proceed the repair” every time I reported for a defect.
Before asking the contractor to preceed with the works, I need to consider a number of list, e.g. is my current material inventory is available? Is my contract committed value is still available for remain work? Is the EAC, actual and committed show in ERP is the last update? etc which I fully rely on the reliability if information shown in my ERP for my “decision making”.
Un-updated information in ERP will let me decide not exactly right on this kind of project.

Seeking the answer by the book, TCM Framework, page 58, and try to read carefully. I see that this book mostly talks at high level decision making: is investment decision making (probably about FEL 1 or 2).
IMHO, I see that the flow process of investment decision making in Figure 3.3.-1 could be applicable to the project execution phase too specially project control activity. The step of develop decision model, quantify value & risk, evaluate and recommended action is iteratively happen in daily basis of my project.
Every time I reported for the repairs with an estimated value of tonnage will charge waiting for my apporoval for go or not go, I following the logic exactly as per map at TCM,p.58, process of invesment decision making, in tactical room.
I need to decide on the repairs, unwittingly I do this process several times, but unfortunatly I found the “input” (information support) is not "real time" or updated. So even the flow process it right, but without good support from information database, the quality of decision will not precisely right.
What I would suggest to my in-direct report, that our ERP need enhancement to support the good project execution. Some of transaction shown in the screen with about 2 months delay, which is need to improve. Some transaction could probably add more than what is exactly appears (system error). Some information need to propose automatically uploaded without need of human interference etc.
A lot of work need to do then to improve our system, but here I just want to underlined that the existence of “reliable information support to decision making” is must in order to run project as per agreed scope, cost and time.