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As I wrap up GTIM’s take on COVID-19 Impact, one year later (ProjectManagement.com’s theme for March), I want to put a bow on the whole what-happened-and-how-do-we-move-on business, from a Project Management perspective (of course). A lot of how we get made whole on the project side of things is going to depend on what kind of contract your Team is working, and which kind of customer. As they (should) teach in risk management (no initial caps) school, the primary vehicle for managing your project’s risk is the contract vehicle itself. If you’re working a firm fixed price (FFP) contract, then your organization has signed on to accept all of the risk for the project, global pandemics (virtually always) included. If, on the other hand, your customer has signed on to a cost-plus contract (e.g., cost plus fixed fee [CPFF], cost plus award fee [CPAF]), then they have committed to sharing some of the risks involved in the project, and your job is now to articulate the best possible case for them to accept as much of that risk as possible. Add to this the PM’s ability to read their customers, and this is where things get tricky.
Just to be clear, nothing in this column should be taken as legal advice when making a force majeure claim. Those questions are best left to the contract administrators and lawyers, and I am neither. This blog is entirely from a Project Management point of view, and my own personal perspective at that. But it seems to me that PMs who have seen a sizable impact from COVID-19, and are working some form of cost-plus contract, could help themselves – and their Teams – by reading their customers’ mood or disposition as they advance their Baseline Change Requests (BCRs).
First off, was your Project’s performance harmed by the pandemic? A simple drop in Cost Performance or Schedule Performance Index (CPI/SPI) can’t be interpreted as ipso facto evidence of COVID-related damages. As I mentioned in an earlier blog, we’re looking at a series of potential scenarios, both with respect to changes in the performance indicators and the condition of the Project both prior to and after the lockdowns became prevalent.
The preliminary analysis has to do with the CPI and SPI behavior. Generally speaking,
- If both CPI and SPI are over 1.00, you are in great shape.
- If CPI is below 1.00, but SPI is over, that simply means you’re accomplishing the Project’s scope faster than originally baselined. If this is perceived as undesirable, simply tap the brakes.
- If SPI is below 1.00, but CPI is over, get on the gas. What you’re doing, you’re doing efficiently – you’re just not doing enough of it.
- Finally, if both CPI and SPI are below 1.00, you are in trouble.
Pretty basic, right? So now let’s overlay this onto the performance figures your Project has seen since February 2020 (the last “normal” month for most of us) and the present. This behavior can be binned, so:
|
Scenario |
Feb 2020 CPI |
Feb 2020 SPI |
Later CPI |
Later SPI |
|
1 |
> 1.00 |
> 1.00 |
> 1.00 |
> 1.00 |
|
2 |
> 1.00 |
< 1.00 |
> 1.00 |
< 1.00 |
|
3 |
< 1.00 |
< 1.00 |
< 1.00 |
> 1.00 |
|
4 |
< 1.00 |
< 1.00 |
> 1.00 |
< 1.00 |
|
5 |
< 1.00 |
> 1.00 |
< 1.00 |
> 1.00 |
|
6 |
< 1.00 |
< 1.00 |
> 1.00 |
> 1.00 |
If you do decide to generate a BCR under these scenarios, here’s what you can expect:
|
Scenario |
What’s going on |
Expected Customer Response to Your Request |
|
1 |
Your project is showing robustness in the face of a difficult business environment. |
Eye roll |
|
2 |
Nothing’s really changed. You’re behind now, but you were behind before. |
Avoids eye contact, crosses arms while you are speaking. |
|
3 |
You were under in both cost and schedule before, but now you’ve made up schedule performance. |
Looks at their wristwatch often, or keeps asking the time. Rubs face as if tired. |
|
4 |
You’re still behind on schedule, but you’ve advanced in cost performance. |
Answers a phone call from school-age child in middle of your pitch, and engages in a conversation that clearly deals with choice of shoe color. Asks if you’ve read Dilbert recently. |
|
5 |
Mirror image of Scenario #2. |
Snickers excessively, or appears to be trying desperately to avoid laughing out loud. |
|
6 |
Your performance actually improved over the lockdown period. |
Customer begins to openly mock you, including an impressive imitation of the way you speak and gesture. Will probably make highly critical comments of the way you’re dressed. |
Of course, if your customer routinely engages in the actions listed in the Response column for Scenario 6, you won’t be able to glean any additional information on the status of your request for baseline adjustment. But, if that is the case, you probably have a lot of other problems anyway.
Posted on: March 30, 2021 09:23 PM |
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