It is very important that the reports are a true reflection of status so that sponsors and stakeholders can have confidence in the performance of the project (or take informed decisions where progress is not going to plan).
If the reports are not accurate, then this could result in the status being misrepresented and storing up issues for the future. The sponsor will not be pleased if a project has been reporting Green for a year, only to find near the end that challenges had not been communicated and the project will be delayed by 6 months. This is not helpful to anyone (especially the project manager).
To help mitigate this risk, the PMO can play an important role in the review and challenge of the reports. However, simply reading the report may not be sufficient to identify areas of concern.
Below are 5 tests that can be applied to check if the report really does reflect the status of the project.
1. RAG versus Commentary
A good project status report should provide an overall status (typically RAG – Red, Amber, Green) and supporting commentary. A simple check is that the commentary supports the RAG.
For example, the project may be reporting Green. However, the commentary may state “there are significant challenges deploying computer hardware meaning that the deployment of software will be delayed 3 months”.
The commentary clearly indicates that there are challenges threatening dates. So the project manager should be questioned as to why this issue is not driving an Amber or Red status.
2. Performance versus Budget
This is another simple, quick test. The project manager should be reporting progress against budget. If you can see that project is over budget, this could be a sign that there are challenges requiring more resources. If this is the case this will mean that the project will go over budget and, there could be challenges that will cause delays.
In a similar way, being under budget is not good. This implies that resources have not been added and that this could mean work is not being completed as expected. Another sign the project is falling behind.
However, there is a word of warning using this measure. The variances could be done to poor planning and changing prices. While this has budget implications, it does not necessarily mean the timeline is under threat. You should use this measure in line with other checks.
3. Performance versus Milestones
This is a good test if a project is on plan. A plan is made up of a number of milestones in a period. Therefore, checking if the milestones in a period have been completed is a good test. For example if the status is Green but 5 out of 10 milestones have been missed in the reporting period, the project manager should be asked to explain why the missed milestones have not impacted the RAG status.
4. Alignment to Associated Projects
The first 3 tests are very much based on the status report for a single project. A very good check is how the status of one project compares with an associated project. For example, a project to deliver a new product may be reporting Green. However, the associated project to deliver the underlying infrastructure may be Red. If the business project is relying on the infrastructure to successfully launch, it is difficult to see how the business project can be Green.
Having an understanding of how the projects in your portfolio are linked will help you to better assess the true status of each project.
This situation can be emotive as the business project manager may feel that their project is Green and they should not be penalised due to the infrastructure project. Remember, the purpose is to report an accurate status so as to manage expectations and allow informed decisions. Therefore, it is OK to report Amber or Red with commentary advising that the status is being driven by the dependency on the infrastructure project.
5. Word of Mouth
This is one of the most important tests, speaking to members of project teams, sponsors and other stakeholders. This will usually result in information that provides more insight to what is going on that is not (or cannot) be placed in the status report. This information is an important measure to which evaluate if the report truly reflects what is going on.
In order to ensure clear and accurate project status reporting, the PMO must do more than accept each report at face value. By combining the 5 simple test, the PMO will be able to quickly ascertain if the report is accurate or, needs to be challenged and changed.
What do you think?
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