UMT Consulting SA, local enterprise project management (EPM) solution provider, has announced that it now offers Project Controls based on Earned Value Management Principles, a sound basis for assessing project progress and performance measurement. It has partnered with Marwillcor Project Control Services, a company that specialises in world-class project controls.
The company plans to expand its offering to ensure projects are completed on time and within budget. Earned value management is a proven systematic approach to objectively measure project progress and performance measurement, while integrating technical scope, schedule, cost and risk.
UMT Consulting CEO Pieter Meyer says earned value management forms a crucial part of project management when establishing the true status of a project. “Earned value management can be applied to any life cycle of a project, to any phase of a project, or as soon as a scope, budget, schedule and the appropriate milestones have been agreed upon. It is also internationally recommended as a best practice in the latest Project Management Body of Knowledge (PMBOK).”
Willie Viljoen, director of Marwillcor Project Controls Services since 1987, carries an AACE international cost engineering qualification and has 35 years' experience in project controls.
Willie worked in collaboration with AD Milne Pr Eng PhD (Chem) of David Milne & Associates, and since 2003 has applied earned value management principles and performance measurement to major projects in South Africa. David Milne has assisted and guided the cost engineering industry in South Africa in the development of earned value management principles since the late 80s.
Viljoen says with earned value management, one can identify under-performance areas as early as the 15% earned value completion mark. “Corrective action must, however, have been successfully implemented by the 45%-50% completion mark to have a positive effect on the outcome. After the 45%-50% earned value completion mark, there may not be enough unfinished scope to influence the outcome.”
“Should you wish to apply earned value management to feasibility studies, one would normally only monitor schedule and cost performance on selected milestones and not on the study outcome, considering that studies are sometimes cancelled before completion,” he explains.
Senior executives could be held criminally liable for misrepresentation of their financials, especially if they engage in major projects and are listed on the USA stock exchange. The diagram above suggests that earned value management to be the methodology to follow to ensure companies produce sound financial forecasts.
South Africa follows the Sarbanes-Oxley Act with the King III Report, not quite as unsympathetic to senior management as the Sarbanes-Oxley Act. However, it is applicable to South Africa from 1 September 2009.
King III provides organisations with guidance on good corporate governance practices. 'The final King Report on Governance for South Africa 2009 (King III)' was launched by the Institute of Directors on 1 September 2009 and can be found on Deloitte's Web site.
“To survive a challenging economy in a project management environment, you may have to become an expert in project controls, and while you can practice good project management (project controls) without earned value management, you cannot practice earned value management effectively without good project management principles,” concludes Viljoen.
For more information, contact UMT Consulting SA on (012) 345-3518 or visit HYPERLINK http://www.umtsa.co.za.
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