Project Management Information Systems (PMIS)

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A PMIS is typically a computer-driven system that can help the project
team to plan, schedule, monitor and report on a project.
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A PMIS can calculate schedules, costs, expectations, and likely
results.
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The PMIS cannot, however, replace the expert judgment of the project
manager and the project team. The goal of a PMIS is to automate,
organise, and provide control of the project management processes.

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The PMIS is used by the project management team to support
generation of a project charter
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- facilitate feedback as the document is refined, control changes to the
project charter, and release the approved document.

Project Charter refers to a statement of objectives in a project.

This statement also sets out detailed project goals, roles and
responsibilities, identifies the main stakeholders, and the level
of authority of a project manager.
 A PMIS Software supports
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Integration Management,
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Project Scope Management,
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Project Time Management,
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Project Cost Management,
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Project Quality Management,
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Project Human Resource Management,
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Project Communications Management,
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Project Risk Management,
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Project Procurement Management,
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Project Stakeholders Management.
 Work Breakdown Structure
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WBS is a project management planning tool used to
define a project in terms of its outputs while providing a
method for breaking these deliverable into meaningful
work units.
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The WBS allows the project manager to describe the
hierarchical nature of the work to be performed.
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WBS capturing the order and sequence of the work
necessary to produce outputs
This information is setup at the beginning of the project and requires
little or no changes. It provides a high-level detail of the project
information to all stakeholders.
Project Earned Value Analysis measures the health of a project by
looking at -
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cost information and
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schedule information concurrently.
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It tells you whether the project is on schedule and on budget, as
well as whether the project is on budget for the amount of work
done so far.
In any given project, there are three variables that control the project
from its conception to finish.

These three variables are the Scope, Cost and Time factors.

The Scope outlines the reason for the project being carried out and
remains constant throughout the project life cycle,

while Cost and Time may be adjusted according to the need and the
phase.

Earned Value is a technique that calculates the cost and time

factors to deduce a monetary value for the project.

It follows the Earned Value Management System to arrive at a value known as the
EAC or Estimate at Completion. The EAC gives an approximate estimation of what the
project is likely to cost based on the projects performance at any given time.
EAC (Estimate at Completion) - An approximate
estimation of what the project is likely to cost based on the
projects performance at any given time. It gives a fairly
accurate estimate of the projects progress based on
Planned Values and Actual Values at the end of the project.

Cost Performance Index (CPI): Represents the amount

of work being completed on a project for every unit of cost
spent. CPI is computed by Earned Value / Actual Cost .
A value of above 1 means that the project is doing well
against the budget.

Schedule Performance Index (SPI) : Represents how

close actual work is being completed compared to the
schedule. SPI is computed by Earned Value / Planned
Value. A value of above one means that the project is
doing well against the schedule.
Cost Variance (CV): This is the completed work cost when compared to
the planned cost. Cost Variance is computed by calculating the difference
between the earned value and the actual cost, i.e. EV AC.

Cost Variance will be negative for projects that are over-budget.

Monitoring project cost variance is critical to ensuring the project is
delivered on budget.

Schedule Variance (SV): This is the completed work when compared to

the planned schedule. Schedule Variance is computed by calculating the
difference between the earned value and the planned value, i.e. EV PV.

A positive Schedule Variance tells you that the project is ahead of

schedule, while a negative Schedule Variance tells you the project is
behind schedule. Monitoring Schedule Variance is critical to
delivering the project on-time.
Planned value is also known as the Budgeted Cost of Work
Scheduled (BCWS).
It is the physical work as per time schedule alongside an authorized
budget for the work.

This is a value that may be assigned at the beginning of the project,

based on the different work phases in a project.

A combination of different works in the WBS (Work Breakdown

Structure) gives rise to the
Budget at Completion (BAC).

The Actual Cost was once known as Actual Cost of Work Performed
(ACWP). As the term implies, it is the cost for the actual physical
work accomplished.
Suppose you have a budgeted cost of a project at $900,000. The project is to
be completed in 9 months. After a month, you have completed 10 percent of
the project at a total expense of $100,000. The planned completion should
have been 15 percent.

BAC = $900,000
AC = $100,000

The Planned Value (PV) and Earned Value (EV)

Planned Value = Planned Completion (%) * BAC = 15% * $ 900,000 = $ 135,000

Earned Value = Actual Completion (%) * BAC = 10% * $ 900,000 = $ 90,000

Compute the earned value variances:

Cost Performance Index (CPI) = EV / AC = $90,000 / $100,000 = 0.90. This
means for every $1 spent, the project is producing only 90 cents in work.
Schedule Performance Index (SPI) = EV / PV = $90,000 / $135,000 = 0.67. This
means for every estimated hour of work, the project team is completing only 0.67
hours (approximately 40 minutes).
Interpretation: Since both Cost Performance Index (CPI index) and
Schedule Performance Index (SPI index) are less than 1, it means that
the project is over budget and behind schedule. This example project
is in major trouble and corrective action needs to be taken.
 Relative Performance Measure of Ongoing Projects

The selection among firms of projects applying for financial

support from a restricted budget constitutes a typical ranking
problem where the decision-maker is called to single out the most
attractive alternatives by taking into account different aspects of
the firms or projects efficiency (Mavrotas et al., 2006).

Ranking and selecting projects is a difficult task with typically

more than one dimension for measuring project impacts and
more than one decision-maker.

TOOL: DATA ENVELOPMENT ANALYSIS

 Data Envelopment Analysis

Data Envelopment Analysis (DEA) is a mathematical programming

technique that provides the correct method for project evaluation and
selection.

DEA calculates the relative efficiency of multiple decision-making units

(DMUs) on the basis of observed inputs and outputs which can be
expressed with different types of metrics.

The DEA approach is used for evaluating the performance of projects

in a multi-project environment where each project is considered a
decision-making unit having its own inputs and outputs, where the
inputs represent the resources to perform the project, and the outputs
represent all of dimensions by which the project is measured.

DEA is used to:

identify the best alternative;

rank the alternatives; or

establish a shortlist of the better alternatives for detailed review.

Given a group of projects, all projects should be able to operate at an
optimal efficiency level which is determined by the efficient projects in
the group.

These efficient projects determine the benchmark, usually referred to

as the efficient frontier, against which the relative performance of
projects is measured.

The projects that form the efficient frontier use a minimum quantity of
inputs to produce the same quantity of outputs.

The distance to the efficient frontier provides a measure for the

efficiency or its lack thereof.

The existing gap from any DMUs to the efficiency frontier shows how
far the DMUs should be further improved to reach the optimal
efficiency level.
Output Variables
In Project Management, time, cost, quality, safety, technical
performance, and satisfaction represent a key category of project
performance measures. In this case study, project duration and
quality are used as the output variables in the DEA model.
Project duration is a measure of the length of the project in working
days.
Quality of the project means delivering precisely what is promised. It
is a measure of how well the project meets the purposes for which it
has been created. Quality can be rated on a scale from 1 to 9, with
1 representing the lowest level of quality and 9 representing the
highest level of priority.
Input Variables
Cost is considered a dimension of project performance, as is project scope
or size. Effort describes the total work content allocated for the project
including the planning stage. Effort can be viewed as a cost measure related
to the project scope or size.
Project staffing.- It describes the average number of people scheduled to
work on a project each day, thus capturing the concentration of labour
resources on the project.
Priority. Priority relates to both top management support and project urgency
.It indicates the importance (urgency) assigned to a project by top
management. Project priority can be rated on a scale from 1 to 9, with 1
representing the lowest level of priority and 9 representing the highest level
of priority.
Level of monitoring. This value, given on a scale of 010 with 1 representing
the lowest level of monitoring and 9 representing the highest level of
monitoring, represents the process of control, monitoring, and follow up
procedures required for performing the project.