Free Custom «Project Performance Measurement» Essay Paper

The successful design, development and implementation of projects are very complex and at times daunting tasks for many project managers. The sum of growth in competition and globalization, institutionalization of innovation-based economics, rapid development of technologies, the uses of outer resources, increase in the significance of customers focus and the shortening of products and services cycles means that projects management has become a multifaceted issue for majority of businesses today. In essence, this has resulted in the need for the adoption and focus on project based management of business activities. Indeed a lot of researcher's emphasis the need for a multi-project environmental management of projects that pays cognizance to the key ingredients that will ensure for the success in projects.This paper will synthesis, analyze and dissect the key attributes that are seen to be inherently important for ensuring effective project management especially in regard to project performance measurement. Despite increase in best strategies and knowledge on project management, many projects do not succeed. The core reasons for this are not particularly hard to discern given the fact that most managers fail to adequately plan and ensure the project performance measurements takes into the consideration of long term strategies and their accompanying matrix. One strategy that has proven to be appropriate in performance management is the Earned Value Analysis (EVA). This strategy is relevant in project performance measurement because of the fact that "current performance is the best indicator of future performance and therefore using trend data it is possible to forecast cost or schedule overruns at quite an early stage in a project" (Haughey, 1). The importance and relevance of this strategy is also demonstrated by Morris, Morris and Pinto (75) in stating that "Earned Value Analysis (EVA) has proven successful for accurate performance measurements and improvement for time and cost on a single project (within a constant scope of quality)"While accurate estimation of time and cost values in the progress of a project are of critical importance to the measure of the project success, there exist other important factors that must also be taken into consideration. These include the role of stakeholders and employee attitude. The attainment of all the stakeholders involvement has been cited as an important ingredient in the success of projects in organizations. This means that every stakeholder in the organization is seen as owners of the project. This ensures that there are no complains about the project contents and performance when it is completed. This becomes more poignant when it is noted that projects warrants large investment of resources such as time, efforts and money. The involvement of the employees, internal customers and other important stakeholders should therefore be paid utmost cognize (Morris, Morris and Pinto, 45)

 

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While EVA has been demonstrated as a very appropriate project performance measurement method, however, it cannot be effectively used in long term projects. This calls for an alternative method of project performance measurement called the Balance Scorecard (BSC). The attention to strategy in advancement of the BSC tool has been paid host by a lot of researchers. The general bearing is that through the development of a sound strategy that encapsulates and visualizes the projects operatives, the causal and effects linkages can be devised and deployed accordingly towards better project's performance. In essence, this should be structured around four major project's organizational perspectives i.e., learning and growth, customers, internal project processes and finances (Morris, Morris and Pinto, 55).

After taking a keen cognize of the above discussed factors, it is important to take note of the project performance and feedback control systems. According to Morris, Morris and Pinto,If the difference between the measurement and the desired value exceeds some threshold, then corrective action (feedback) of some type is involved and the degree of corrective action may be a function of the size of the difference (and/or the integration {accumulation} or differentiation {rate} thereof) (76).This therefore means that the measurements may either be process or process outputs.In addition to the above, once the management has decided to measure and control performance, they must be prepared to correctly identify the elements to measure and control. As has been explained, the central role of performance measurement is to achieve a measure of dimensions in respect to what is done (scope and quality) against the resources employed to perform the work (cost and time). It is therefore imperative in project performance to measure the project team, performing organization and line management. Furthermore, the measurement of the benefiting group which in this case is the customer is equally important. Lastly, the performance measurement must include the measure of project sponsors. To determine whether a project is successful note, it is important to develop success criteria that underline the project's success factors. This is because the definition of a "successful project" varies with the type of the project under study.In conclusion, it is true that "past performance is a good indicator of future performance and as such Earned Value is a very useful tool for predicting the outcome of projects in terms of time to completion, cost to completion and expected final costs" (Haughey, 1) . In this regard, the integrations of Earned Value Analysis and success factors into Balanced Scorecards would maximize the performance measurement of a project. This is because of the fact that EVA would adequately address the short term goals of the project in respect to time and cost while BSC would take care of the long term objectives.