15 Chapter A4148 23218 6/9/01 7:17 AM Page 417 15Controlling Objectives After reading this chapter, you will be able to: 1. 2. 3. 4. Understand the importance of good project control to keeping things on track Discuss the controlling processes and outputs and how they were used on ResNet Describe the tools and techniques used for project control on ResNet Discuss challenges the ResNet team faced in controlling the project and decisions they made to manage these challenges 5. Describe the use of change management on this project 6. Relate some of the controlling events in ResNet with concepts described in previous chapters P eeter learned that managing change was 50 percent of a project manager's job. He also learned that every stakeholder was different. His team had to develop strategies for dealing with the unique personalities involved in ResNet. The executive management team, in particular, needed special consideration, as did the reservation sales agents. Peeter's team knew that members of the executive team liked to make decisions. They also knew that typical status reports would bore this group. Therefore, at the 1996 ResNet review meetings, instead of reporting on how things were going, each presenter focused on key issues and decisions needed by the executive team. Would this strategy help keep ResNet on track and get the executive management team to make important decisions quickly? The unionized reservation sales agents were also crucial stakeholders in ResNet's success. How should the ResNet team manage the problems inherent in developing and delivering a new information system to these sales agents? How could they overcome potential resistance to change? 15 Chapter A4148 23218 6/9/01 7:17 AM Page 418 418 C H A P T E R 1 5 WHAT IS INVOLVED IN CONTROLLING PROJECTS? Controlling is the process of measuring progress towards project objectives, monitoring deviation from the plan, and taking corrective action to match progress with the plan. Controlling cuts across all other phases of the project life cycle. It also involves seven of the nine project management knowledge areas: Project integration requires integrated change control. Outputs include updates to the project plan, corrective actions, and lessons learned. Project scope management includes scope verification and change control. A key output is scope changes. (Note that some aspects of scope verification for ResNet were described in Chapter 14, Executing.) Project time management includes schedule control. The output of this process is schedule updates. Project cost management involves cost control. Outputs include revised cost estimates, budget updates, and estimates at completion. Project quality management includes quality control. Outputs are quality improvements, acceptance decisions, rework, completed checklists, and process adjustments. Project communications management includes performance reporting, and outputs of this process are performance reports and change requests. Project risk management involves risk monitoring and control. Outputs of the risk monitoring and control process include work-around plans, corrective actions, project change requests, and updates to the risk response plan. Table 15-1 lists the knowledge areas, processes, and outputs that are generally part of project controlling. This chapter will focus on the ResNet project's key controlling activities such as schedule control, scope change control, quality control, performance and status reporting, and employee change management. 15 Chapter A4148 23218 6/9/01 7:17 AM Page 419 CONTROLLING 419 Table 15-1: Controlling Processes and Outputs KNOWLEDGE AREA PROCESS OUTPUTS Integration Integrated Change Control Project Plan Updates Corrective Actions Lessons Learned Scope Scope Verification Scope Change Control Formal Acceptance Scope Changes Corrective Actions Lessons Learned Adjusted Baseline Time Schedule Control Schedule Updates Corrective Actions Lessons Learned Cost Cost Control Revised Cost Estimates Budget Updates Corrective Actions Estimate At Completion Project Closeout Lessons Learned Quality Quality Control Quality Improvement Acceptance Decisions Rework Completed Checklists Process Adjustments Communications Performance Reporting Performance Reports Change Requests Risk Risk Monitoring and Control Work-around Plans Corrective Actions Project Change Requests Updates to the Risk Response Plan Risk database Updates to Risk Identification Checklists SCHEDULE CONTROL Recall that Peeter's main strategy for avoiding schedule-related problems and conflicts was to focus on meeting schedule dates. Peeter worked with his project team to determine important milestones and set realistic dates for their completion. Peeter also focused on meeting business needs. Problems with WorldPerks and the Chisholm office caused the start of the Detroit office installations to slip by about three weeks, but it was in the best interest of the business to allow that slippage to occur. 15 Chapter A4148 23218 6/9/01 7:17 AM Page 420 420 C H A P T E R 1 5 Peeter admitted that they sacrificed some functionality of the ResNet system to meet deadlines. Recall that Peeter and Fay budgeted for a certain number of people to work on ResNet software enhancements after writing the beta software. These people developed as many enhancements as they could, given their schedule constraints. Peeter felt that making this trade-off was in the best interests of the overall project and business. Overall, the project was completed on time and just slightly over budget. Recall that part of a project manager's job is making trade-offs related to the triple constraintscope, time, and cost. Peeter often focused on meeting time constraints to avoid the problems that missed deadlines would have on the rest of the project. This strategy meant that he and his team worked long hours during certain parts of the project. Arvid recalled several times when he did not think his team could meet a deadline, and Peeter would say, \"Failure is not an option.\" Because the ResNet team were all salaried employees, they did not receive paid overtime. They worked extra hours as needed to help an important and challenging project succeed. What Went Right? Peeter had gone through project management training when he worked in Canada. One piece of advice he remembered was to focus on meeting the project schedule goals. Date changes tend to cause chaos throughout a project. Therefore, his goal for ResNet was to establish key dates and vary the scope as needed to stay on schedule. To emphasize the importance of schedule, the ResNet team made the theme for the 1996 ResNet kickoff meeting \"What About Wendy?\" Wendy was the office manager of the last call center scheduled to get ResNet PCs. The theme stressed the importance of meeting schedule dates so that Wendy's group would not be disappointed. The ResNet team displayed a Gantt chart and explained that missing any deadlines would hurt Wendy. This personal touch helped everyone focus on meeting deadlines. Throughout the ResNet projects, Peeter stayed firm on dates, and all stakeholders knew that key dates were real and not subject to change unless there were insurmountable obstacles. Peeter used a football analogy to explain his commitment to keeping the schedule: If a team keeps getting first downs, it will score touchdowns. If his ResNet team focused on meeting key incremental dates, they would finish the project successfully. This strategy worked well on ResNet most of the time. 15 Chapter A4148 23218 6/9/01 7:17 AM Page 421 CONTROLLING 421 What Went Wrong? The WorldPerks application development and office rollout in Chisholm, Minnesota, provided one of the toughest challenges for the ResNet team. They had underestimated how long it would take to develop the WorldPerks software, plus they ran into technical and personnel problems. The WorldPerks software had to interface with the IBM 3270 system, and the ResNet team and vendors had to develop special communications software for this interface. It was much more complicated than they anticipated. Also, the state of Minnesota funded the Chisholm office to develop more jobs in the Minnesota Iron Range. All of the office employees were new hires, so they did not understand Northwest Airlines' reservations systems work flow. Many of the new employees had little experience with computers, so the ResNet team had to send in people to work with them and help coordinate technical and training problems with the main office in Minneapolis. The project incurred additional costs, and the extra work for this office delayed the start of the Detroit implementation by about three weeks. Peeter and Fay wanted to change the sequencing of office installations after the problems that occurred in Chisholm. The Detroit office installation also used the WorldPerks application and could not be completed until the Chisholm office was completed. (Note the finish-to-finish relationship between Office 2 and Office 3 on the Gantt chart in Figure 13-3.) Peeter and Fay did not want the Detroit installation to be late, as this would affect the entire project schedule. They also did not want people waiting around in Detroit because their start had been delayed. Arvid and other ResNet team members banded together to successfully convince Peeter and Fay not to change the sequencing of office installations because it would disrupt many of their plans and cause even more problems. With a lot of extra hours and some extra money for additional temporary staff, the Chisholm and Detroit offices were both completed on time. SCOPE CHANGE CONTROL All stakeholders were involved in determining and controlling the scope of ResNet. Sales agents and their managers defined the basic requirements for the software and made suggestions on enhancements. Senior management determined the overall scope, budget, and schedule goals. The 1996 kickoff meeting emphasized the purpose of the ResNet projects and their scopes. Table 15-2 presents some of the statements about purpose and scope that were used at the kickoff meeting. 15 Chapter A4148 23218 6/9/01 7:17 AM Page 422 422 C H A P T E R 1 5 Table 15-2: Kickoff Meeting Statements About ResNet Purpose and Scope PROJECT PURPOSE PROJECT SCOPE Provide ResNet presentation screens for all reservations personnel 3,000 PCs in 8 reservations offices and Iron Range Reservations Center (IRRC) (Note: These numbers include the completion of the 1995 ResNet project.) Connect ResNet to an information pipeline and to other distributed systems at Northwest and alliance partners Four applications: Sales Specialty Sales Support Desks Integrated WorldPerks Design for rapid evolution to meet changing business needs Preproduction prototypes for intelligent call processing and keyword search Peeter and his team worked hard to get buy-in from all stakeholders of ResNet. Peeter used the following words to describe the purpose of the 1996 ResNet kickoff meeting: \"to launch the ResNet implementation and develop a shared responsibility for a successful outcome.\" By creating a solid sense of unity among all project stakeholders, everyone shared in the responsibility and success of the project. Peeter held regular meetings with team members to handle potential scope changes. They accepted some small changes in scope, but only if those changes made business sense and would not be detrimental to the whole project. The number of PCs and software applications never changed from the original plan, but the sales agents requested additional capabilities from the ResNet software. As mentioned in Chapter 14, Executing, people were assigned to ResNet to develop enhancements to the software even as it was being presented to the sales agents. The ResNet screen included the capability to send enhancement requests to the software developers. Kathy Christenson was surprised and yet excited about the number of requests they receivedover 11,000. She developed a change control process with the managers who sponsored the four main software applicationssales, specialty sales, support desks, and WorldPerks. Each of these managers had to prioritize the software enhancement requests and decided as a group what changes to approve. The developers of the system enhancements then implemented as many items as they could, in priority order, given the time they had. About 38 percent of the 11,000 suggestions were implemented. 15 Chapter A4148 23218 6/9/01 7:17 AM Page 423 CONTROLLING 423 QUALITY CONTROL Because the software development team knew the reservation process and what shortcuts agents might take while using the new system, the team was able to develop user-friendly, foolproof software. For example, some sales agents were concerned about meeting their required performance statistics for the average length of calls and the percentage of direct sales. Some agents dreaded customers who wanted to make rental car reservations because of the increased call time. Therefore, the ResNet software developers streamlined the rental car reservation process. They added scripted prompts to help the sales agents ask about car rentals and make them more comfortable when trying to close sales directly by asking for the customer's credit card information. The industrial engineers supporting ResNet took several important actions to control quality. In addition to analyzing the reservation process in detail and making suggestions on improvements, they helped select a random sample of sales agents to properly test the impact of ResNet. They also developed several charts for measuring the business benefits of ResNet. Arvid Lee mentioned that he had never seen as much statistical analysis done on a project as was done on ResNet. As part of the beta project, the industrial engineers used statistical techniques to select a sample of reservation sales agents to test ResNet. At the time, there were over 4,000 reservation sales agents. They wanted to make sure their testing was not biased by factors such as gender, age, location, shift, or efficiency of the agents. They ensured that the agents involved in testing the benefits of the new system were a random sample of the total group of all NWA reservation sales agents. The final project audit mentioned that biasing factors, such as weather, new hires, and the changing sales environment, were isolated using multiple regression analysis to determine the true impact of ResNet. Many people ignore or discount statistical analysis and quality control reports, but the people supporting ResNet developed several particularly useful reports for measuring the quality and progress of ResNet. Figure 15-1 shows a chart used to track the learning curves for new hires using ResNet versus NWA's native reservations system on TELEX terminals. The shapes of the curves are similar, but the ResNet agents started and ended at a shorter call handle time. This shorter call handle time was believed to be due to the friendlier design of the new interface provided by ResNet. 15 Chapter A4148 23218 6/9/01 7:17 AM Page 424 C H A P T E R 1 5 500 450 Call Handle Time (Seconds) 424 400 350 300 TELEX 250 RESNET 200 0 2 4 6 8 10 12 14 16 Weeks Since Training Figure 15-1. New Hire Call Handle Time Learning Curves The industrial engineers also created charts plotting the predicted versus actual number of direct ticket sales per 100 calls, as shown in Figure 15-2. The forecasting model they developed proved to be 87 percent accurate in forecasting performance on the TELEX system. Because the high accuracy percentage showed that the engineers had very good forecasting capabilities, senior management believed their estimates for the direct ticket sales projections for ResNet. Increasing the number of direct ticket sales would provide great financial savings to NWA. 15 Chapter A4148 23218 6/9/01 7:17 AM Page 425 CONTROLLING 425 16 14 Actual 10 8 Predicted 6 4 25-May-95 11-May-95 27-Apr-95 13-Apr-95 30-Mar-95 16-Mar-95 2-Mar-95 16-Feb-95 0 2-Feb-95 2 19-Jan-95 Direct Tickets per 100 Calls 12 Week Figure 15-2. Direct Tickets per 100 Calls Actual vs. Predicted Having forecasts and tracking their progress against the forecasts helped the ResNet team and sales agents using the new system focus on the project's business goals. The immediate feedback available each week from these charts prompted the team to push forward. Reservation sales agents actually looked forward to seeing these quality control reports. PERFORMANCE AND STATUS REPORTING In addition to quality control reports, the ResNet team generated other types of performance and status reports. Emphasis was placed on key issues, decisions that needed to be made, and numerical progress on the project. Important numbers tracked were the number of PCs installed, the average call handle times for sales agents, and the number of calls resulting in direct ticket sales. This emphasis on issues, decisions, and progress helped keep people, especially senior management, interested and involved in reading and listening to performance reports. Figure 15-3 shows a sample status report created by a ResNet team member. The format of the weekly status report included four sections: milestones, issues, accomplishments, and goals. The first section listed milestones along with planned and actual target dates, whether the item was completed, on schedule, or behind schedule. The second section listed issues requiring discussion and 15 Chapter A4148 23218 6/9/01 7:17 AM Page 426 426 C H A P T E R 1 5 assistance. The majority of status reports included some items in this section, consistent with Peeter's directive to focus on issues and decisions that had to be made, instead of boring people with technical facts. The final two sections listed the last period's accomplishments and the next period's goals. Milestones Plan Actual Status Complete 3270 testing Event Recorder Activated in Tampa Presentation to NWA Finance Com 5 Jun 6 Aug 6 Sep 9 Jun Completed On schedule On schedule Issues Requiring Discussion/Assistance Need definition of WORLDSPAN/CORDA Change Management Process IMPACT: Need process that notifies ResNet of scheduled system changes ASSIGNED TO: J. Huss Last Period's Accomplishments Completed initial design of Event Recorder analysis and began coding Researched slow response times in Tampa. Looked at Baltimore response times Completed minor adjustments to measurement reports per customer request Next Period's Goals Conduct formal review session for Address Verification approval Beta test Event Recorder in the Hotline area in Bldg C Figure 15-3. Sample Weekly Status Report The graphical progress report described in Chapter 14 (see Figure 14-2) also helped communicate project status. Every few weeks each office received an office layout chart that showed what installations were completed. This report, along with the learning curve charts for new hires' call handle time and the charts plotting direct ticket sales, helped keep the ResNet project on track in meeting performance goals. The staff focused on meeting key business goals of the project, and the report formats kept ResNet stakeholders informed of progress. MANAGING RESISTANCE TO CHANGE Arvid and Kathy, the information systems and application development team leaders, did not have the traditional view of change management as the process of handling requests to change project scope, time, or cost. They were used to developing good project plans and executing them accordingly. They viewed change management as dealing with people's natural resistance to change, especially when that change involves new technology. The resulting change management process was a key factor in managing the project and ensuring its success. NWA formalized the importance of change management in their organizational structure for large information technology projects. The ResNet project 15 Chapter A4148 23218 6/9/01 7:17 AM Page 427 CONTROLLING 427 included a full-time analyst responsible for ResNet change management and several reservation sales agents responsible for training and awareness. Nancy Strobel was the head of ResNet Change Management and reported directly to Peeter. She worked with a team of people from the reservation offices to help people get involved in, get prepared for, and deal with the changes resulting from a new reservation system. They prepared a change management plan and were instrumental in getting all of the reservation sales agents and their managers to support ResNet. As part of their change management tactics, they helped develop and implement themes for each office, as described in Chapter 14, Executing. For example, they helped create posters with a Broadway show theme saying \"ResNetComing Soon\". They also provided special ResNet wrist pads, coffee mugs, and other items to get the agents excited about the new system. The change management team was also instrumental in identifying people who might be resistant to the new system. Because the reservations sales agents would be most affected by the new reservation system, the change management team decided to create a videotape after the ResNet beta test. Below are the opening remarks from this videotape: \"Recently we began testing a new reservation system called ResNet with agents from several of our offices. At the end of the test, we sat down with these agents and asked them their candid opinion of ResNet. Now, we know that change can be difficult. But what we found and what you're about to hear will hopefully show you that this is change for the better. Our vision is that ResNet will improve customer service, increase efficiency and revenue, and ultimately make your job easier. Once again, you will be hearing from your peersagents who have used this new systemgiving their honest opinion of ResNet.\"1 The videotape included comments from many different sales agents, representing several sales offices. There were male and female sales agents of various nationalities and age groups in the videotape. It was very effective in getting the sales agents interested in the new system and calming some of their fears. For example, a couple of the sales agents in the videotape mentioned that it was hard to get used to the new system at first, but that it was definitely worth it. Several agents mentioned that they had fewer headaches because of the new screen colors, and their job performance and job satisfaction improved with the new system. The change management team also decided that every single reservation agent should get at least thirty minutes of one-on-one training on ResNet. This one-on-one training helped personalize the experience and allowed people to feel comfortable asking questions. Providing this individualized training for about 4,000 sales agents showed that the ResNet team cared about the sales agents and was willing to invest the time and money to help them adjust to the new system. 1Comments made by NWA Director Crystal Knotek. Northwest Airlines \"ResNet,\" JUNTUNEN VIDEO, Inc. April 4, 1995. 15 Chapter A4148 23218 6/9/01 7:17 AM Page 428 428 C H A P T E R 1 5 CASE-WRAP UP Peeter's idea to have status review meetings with upper management focus on discussing issues and making decisions was very successful. The managers were engaged in the meetings and offered good suggestions for keeping ResNet on track. Peeter made sure his team concentrated on using both business and technical terms at these meetings. They also used charts to track the project's numerical progress, such as the number of PCs installed to date. This focus on decision-making and numerical measures of progress worked well to get senior management's support in controlling the project. The change management team was instrumental in helping sales agents adjust to the new information system. The sales agents involved enjoyed creating the beta test videotape, and other agents enjoyed watching it. The agents also appreciated the one-on-one training on ResNet, and they looked forward to seeing their progress in reducing call handle times and increasing direct sales in the quality control charts. All stakeholders were very pleased to see the financial results of ResNet when the final audit report showed that the increase in direct sales attributable to ResNet greatly surpassed expectations. Instead of increasing direct sales by 5.5 percent as planned, ResNet had increased direct sales by 17.7 percent. This 17.7 percent increase meant an additional $2.3 million in 1996 commission savings. C H A P T E R S U M M A R Y Controlling is the process of measuring progress toward project objectives, monitoring deviation from the plan, and taking corrective action to match progress with the plan. Controlling cuts across all phases of the project life cycle. Peeter made keeping on schedule a priority and focused on achieving milestones one at a time. The ResNet team faced several challenges in meeting project schedules, and they delayed the Detroit office installation to meet more important business needs. They did, however, successfully complete all of the ResNet projects according to schedule. The ResNet project was designed to accept software enhancement requests, but the software developers could not implement all of the suggested changes. Managers prioritized enhancements, and the software developers completed as 15 Chapter A4148 23218 6/9/01 7:17 AM Page 429 CONTROLLING 429 many as they could while still meeting schedule deadlines. They implemented about 38 percent of 11,000 suggested enhancements. Quality control techniques were a factor in communicating progress and pushing staff toward project success. Industrial engineers played an important role in project control. Performance and status reports focused on issues and tracking key performance numbers. The ResNet project included a full-time analyst for change management in addition to reservation sales agents responsible for training and awareness. NWA understood the importance of helping people adjust to changes and invested funds in creating a videotape about ResNet for the sales agents and in one-on-one training. DISCUSSION QUESTIONS 1. Recall that the 1995 Standish Group study of information technology projects found that the average schedule overrun was 222 percent. Also recall that schedules are the main source of conflict on projects. Discuss Peeter's decision to focus on meeting schedule milestones. Could this approach be taken on more information technology projects? Justify your answer. 2. The ResNet group adopted a philosophy of giving up some system functionality to meet milestones. What do you think about this approach? Could this approach be taken on more information technology projects? Justify your answer. 3. Discuss the charts created for quality control (Figures 15-1 and 15-2). Do you think most users would understand and appreciate these types of charts? Do you think they influenced the reservation sales agents to work harder because they knew their progress on reducing call handle time and making direct sales was being tracked? Could this approach be taken on more information technology projects? 4. Discuss the format of the sample weekly status report. What do you like/dislike about it? Does emphasizing issues and decisions make sense? Could this approach be taken on more information technology projects? 5. Discuss the use of a change management team on ResNet. Could this approach be taken on more information technology projects? EXERCISES 1. Read the article by Elton and Roe listed in the Suggested Readings. They provide and critique project management suggestions made by Eli Goldratt in his books The Goal and The Critical Chain. Write a paper summarizing the key points of this article and how it relates to the ResNet project. Be sure to address the authors' point that measurements should induce the parts to do what is good for the whole. Also discuss Goldratt's view that the fewer the milestones, the fewer the delays, and how it relates to ResNet. 15 Chapter A4148 23218 6/9/01 7:17 AM Page 430 430 C H A P T E R 1 5 2. Find two examples of recent status reports for projects. Compare the information they contain with the example in Figure 15-3. Write a oneto two-page paper summarizing and analyzing your findings. Include the two examples you find as attachments. Include suggestions on how to prepare good status reports in your paper. 3. Do an Internet search on \"project control.\" Summarize some of the many vendors that offer their services to help control projects. Try to find any real advice or information on what helps control projects, especially in information technology. 4. Research quality control techniques. Write a two to three-page paper summarizing at least two different techniques and try to find examples of how they helped keep projects under control. 5. Research books and articles on helping people deal with change, especially new technologies. Kanter's book (see the Suggested Readings list) is a classic in this area. Summarize information from three good sources on change management and provide your opinion on their recommendations. MINICASE Peeter did an excellent job of controlling the ResNet projects, but he faceed several challenges and used unique approaches to managing change. Part 1: Review the information provided in What Went Wrong? and the paragraph following it. Pretend that you are Arvid Lee and that you want to rally other members of the ResNet team to convince Peeter and Fay not to change the sequencing of office installations. Develop a plan for how you would convince your teammates to take a stand. Include in the plan how the team would convince Peeter and Fay not to make the schedule changes. Part 2: The ResNet team's approach to scope change control was unique. Specific people were assigned to develop enhancements to the software, but these people could not handle all of the enhancement requests. Develop a weighted scoring model that could be used to help prioritize which enhancement requests should be implemented. For example, criteria might be the potential value of the new enhancement, how long it would take to implement, how many agents would use the new enhancement, and so on (see Chapter 4, Project Scope Management, for information on weighted scoring models). Also develop a form for submitting enhancement requests. SUGGESTED READINGS 1. DeMarco, Tom. The Deadline. New York: Dorset House Publishing, 1997. Tom DeMarco has published several articles and books related to managing software development projects. This book is a business novel that illustrates the basic principles that affect the productivity of software development teams. 15 Chapter A4148 23218 6/9/01 7:17 AM Page 431 CONTROLLING 431 2. Elton, Jeffrey and Justin Roe. \"Bringing Discipline to Project Management.\" Harvard Business Review (March/April 1998). This article discusses Eli Goldratt's books on project control and offers suggestions for using a more disciplined approach to project management. Suggestions include having measurements that induce the parts to do what is good for the whole, having strong senior management involvement, and focusing on personal skills. 3. Goldratt, Eliyahu and Jeff Cox. The Goal: A Process of Ongoing Improvement, Great Barrington, MA: North River Press, 1994. In this book Goldratt uses a fictional story to illustrate the fundamentals of running a business. He describes several problem-solving techniques for managers who lead organizations through change and improvement, which are inevitable in any industry. 4. Kanter, Rosabeth Moss. Change Masters: Innovation and Entrepreneurship in the American Corporation. New York: Simon & Schuster, 1985. Dr. Kanter's book describes how to be effective in overcoming the kind of \"stalled\" thinking that inhibits progress in almost all organizations. The author draws strongly from her own research in several different organizations to offer strategies for mastering change and ensuring progress