1.1

Set up weekly, bi‐weekly, or monthly (whichever is appropriate) cost and schedule reporting systems for all project groups. Make sure you receive honest and accurate reports.

1.2

A guideline for the minimum review cycle is the length of the project divided by ten or twelve. However, if the data is based on a best guess, the review cycle needs to be more frequent, for example, double this number.

1.3

Set up a trend programme with weekly meetings and ensure that they work. See Section L Variations/Changes/Claims, subsection 2, Trend Meetings.

1.4

Ensure that all senior team members understand the need to monitor and control on a regular basis:

1. Scope
2. Cost
3. Schedule
4. Quality
5. Resources/personnel.

They should report any deviations from the original plan in the trend meeting.

2.1

Set up a ‘war room’ – a conference room with plenty of flat wall space. Use this conference room as the progress reporting room, and attach as many graphical reports as possible to the wall. For example:

1. The 30/60/90 day logic diagram
2. The project bar charts
3. ‘S’ Curves (see Part V, Section N)
4. Resource histograms
5. Budget/estimate usage line (Figure IV.K.1)
6. Site photographs.

2.2

The visual impact of seeing the planned and actual charts superimposed or side by side can act as a motivator and even engender competition between groups.

3.1

The overall percentage progress will be determined from the weighting of each element at the top level. The weightings for the level 2 elements are determined by their budgeted money value. At lower levels, it does not matter what the measured units are, provided the numerator and denominator, used for calculating the percentage, are the same.

3.2

The units chosen to measure progress do not have to be the same right across the whole project. They can be mixed and matched to provide the most robust and manageable result. In the home or design office, the measurement is usually in man hours and performance measurement and earned value is explained in Part V, Section L, also see Section N, ‘S’ Curves.

3.3

Ensure all percentage‐complete reporting is based only on deliverables completed. Never allow people to claim progress merely because they have used hours.

3.4

Pay particular attention to the purchase of equipment and materials since this gives the best indication of the health of the project. If orders have been placed, then data and drawings can be released to design engineering. If orders have been placed, then deliveries can take place for construction needs.

3.5

Be wary² of construction under reporting, in the early stages, whilst you, the project manager, are still chasing up work in the home office before relocating to site. Construction has a habit of blaming the home office for holding them up for not producing the drawings and materials fast enough. They do this so that they can look good by rescuing the project later on with better‐than‐average performance.

3.6

Be aware³ that all factions of the project will have different agendas and will manipulate (if they are in a position to so do) the measurement to support whatever agenda they are following. For example: contractors, especially at senior management level, will always want optimistic (that is overstated) progress in order to improve cash flow.

4.1

There will actually be two reports: one for the client and one for senior management. The second will be far less generic and will be significantly influenced by the individual company requirements.

4.2

Initiate a standard format and get agreement for formally reporting progress to the client or owner. Sometimes two monthly reports are prepared: one listing physical progress and the second a cost report – although there will be a lot of repetition to make it meaningful.

4.3

If possible, that is if the client or owner agrees, keep the textual content of the progress report to a minimum. Use charts, graphs, diagrams, and so on.

4.4

The executive report for the overall project (Level 1) will be made up from the monthly reports of the top‐level components (the subprojects at Level 2) of the product breakdown structure (see Section F Scope).

4.5

Suggested contents for a monthly progress report are as follows:

1. Cut‐off date for data collection and work period covered
2. Project manager's highlights for the period covered
3. Problem areas and proposed actions
4. Home office man hours and manpower histograms
5. Construction nonmanual man hours budget expended, scheduled, and forecast
6. Status of key subcontracts with supporting curve
7. Major equipment and material purchases with curves
8. Logistical highlights
9. Summary of cost and commitments against budget and current forecast
10. Engineering and construction progress achieved versus planned and ‘S’ curves
11. Milestones achieved
12. Status of variations and changes
13. Forecast completion date and variations from the previous report
14. Progress photographs
15. And so on, but remember for what purpose the information is required

Items b to m will be summarized (one‐page maximum) as the executive summary.

5.1

Whilst many of the other reports are focused on the individual discipline issuing the report, this report cuts across disciplines, and time spent reviewing it is essential for control of the project.

5.2

A few basic rules:

1. The allocation of cost elements must always match those used in the estimate.
2. When allocating costs, always start with the total figures and then apportion them.
3. When recording costs, always think about the total cost (including indirect costs), not just the direct cost of the obvious component.
4. Be very careful when comparing figures from different sources or put together in different ways – it's dangerous.

5.3

Again there will actually be two cost reports: one for the client and one for senior management. The second report will have a very defined format so that it is the same as the reports from all the other projects. Nevertheless, a cost report should consist of cost and revenue items for:

1. Major equipment
2. Bulk materials
3. Subcontract
4. Direct‐hire labour
5. Nonmanual labour
6. Home office services
7. Exceptional items
8. Contingency
9. Currency fluctuation adjustment
10. Approved and pending scope changes

These items will be tabulated for each of the following headings:

1. Tender/proposal
2. Original budget
3. Current budget
4. Current forecast
5. Forecast variation, over or under the current budget.

The internal report for senior management will include an item showing the forecast contribution/margin/gross margin/profit and reserves being earned.

6.1

Relentlessly chase progress.

6.2

Regularly check costs.