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Topics: Construction
What's the best way to track projects based on $?
Anonymous
I'm trying to come up with a better way to track contracted projects based on dollars and am not sure whether a Gantt Chart can be converted to suit this purpose. Completion dates are constantly changing because they start and stop based on what customer has paid. I'm joining this team mid project and trying to help refine how it is being tracked. Right now when one portion gets completed everything is on hold until the customer has paid for next step in the project. The progress is currently tracked based on how much of the customer's quoted price has been paid. i.e. Customer was quoted it would cost $100,000 to do the job, customer has paid $50,000 so job is considered 50% done. Does anyone have a suggestion?
Thank you in advance.
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Network:1472



Is customer payment really an accurate measure of what the team had completed? I would suggest this is fine for tracking revenue recognition but won't really provide a clear picture of project status. Earned Value might work better...
Network:83



It is very unclear what you are trying to accomplish with this. What you cite as your current tracking method sounds more like accounting than PM. How are you tracking what actual scope is complete?? Kiron is probably correct that EVM is a good methodology to give a clear picture, but I think you need to refine what you are trying to accomplish with the tracking. When you say "track based on dollars", are you trying to figure out what elements of scope are funded and which are unfunded?? Are you trying to determine what additional costs must be borne to complete a required scope??
Network:97845



Actually, you have a milestone-based payment schedule. You are paid for each milestone completed. I don't see why you can't say that 50% of your milestones have been completed. After all the client would not pay for it if it wasn't completed.
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1 reply by Joseph Gherlone
May 29, 2019 5:24 PM
Joseph Gherlone
...
it is clear that you, sir, have never worked for the US military (or the Canadian military) ...
Network:106



You mentioned that “The progress is currently tracked based on how much of the customer's quoted price has been paid.” Which means that customer is tracking the project progress and paying what has been delivered. If you are trying to instill something new in between the project, would shift your focus away from the project.
Gantt chart will show milestone, what and how much needs to be delivered at a particular time. It will show progressive nature of the project. How much the project has progressed and fixing a % progress is based on what you be defining with the team, customer and other stakeholders. To track project progress EVM is used for better reporting
Network:19



Mr. A-
I have a few thoughts about tracking based upon payments:
1) This Contract is probably not large enough to track accurately based upon
payments- A 100 Million USD Contract would be more accurate using the CPI-
Cost Performance Index assuming your Precon Team used accurate costs
tied to the milestones and Contract values.
2) The Milestones method described above would be a better indicator of Project
progress- with the exception of the required Prepayments for Long Lead items in
within the Scope of Work. Typically, the Owner does not reimburse the
Contractor accurately for these items, causing the Cost performance Index to
"Slip".
3) In your case, If you have a good Projects Control Team, they will be able to tie
Completed Manhours and procurement costs to Total Manhours/Costs for a
more accurate index of the progress.
4) The Project Manager for your Project should be able to determine the best
method for your Contract- based upon Milestones, Costs, or Schedule.

Good Luck!
From the Trenches!
M
Network:21777



Agree with Stephane.
Network:83



May 28, 2019 9:05 PM
Replying to Stéphane Parent
...
Actually, you have a milestone-based payment schedule. You are paid for each milestone completed. I don't see why you can't say that 50% of your milestones have been completed. After all the client would not pay for it if it wasn't completed.
it is clear that you, sir, have never worked for the US military (or the Canadian military) ...
...
1 reply by Stéphane Parent
May 29, 2019 7:24 PM
Stéphane Parent
...
I did do work for the US Navy Corp, helping with IT infrastructure. My current project is about delivering services to serving and veteran Canadian Armed Forces.

I believe I understand your statement. Perhaps you would care to elaborate so other understand your point of view.
Network:97845



May 29, 2019 5:24 PM
Replying to Joseph Gherlone
...
it is clear that you, sir, have never worked for the US military (or the Canadian military) ...
I did do work for the US Navy Corp, helping with IT infrastructure. My current project is about delivering services to serving and veteran Canadian Armed Forces.

I believe I understand your statement. Perhaps you would care to elaborate so other understand your point of view.
...
1 reply by Joseph Gherlone
May 30, 2019 2:41 PM
Joseph Gherlone
...
sorry. that was intended as a joke. your statement was that clearly no one would be foolish enough to pay for work that had not been completed. I was being sarcastic as to the ability of the US military (and CF - they are nearly as bad, in the work I've done with them) at being able to track what has been done and when to issue payment.
Network:19



All-
US Government and Tier 1 Construction Projects have a Contract Required method of Assessing Progress. It is stated that a Primavera based Proposed/Actual Schedule performance will illustrate the Progress to the Owner.
I will not discuss the challenges with the strict reliance on P6 here. Simply stated, the P6 is only as good as the Original Scheduler, and frequently not good at all.....

From the Trenches!
M
Anonymous
My apologies for not responding sooner.

I’m coming into this mid-stream and have been asked to help make improvements. I’m attempting to do this with the minimal amount of change in their tracking. I wanted to check with you – the more experienced – to find out whether there was something I am missing. Based on your feedback it doesn’t appear so.

Kiron, your suggestion aligns with what I was thinking. The issue is that I don’t have any milestones to work with.

Ganesh, you are partially correct. We are the middleman. We hire contractors to complete the work and currently track the percentage of job completion based on how much the contractor has been paid (actual cost) compared to how much the contract was for (planned value). This is inaccurate and misleading (you cannot have a job 124% done if they haven’t finished it yet?) I’m struggling because without milestones to work with I am not sure how I can help them. There are very few contractors that have an established completion date and even fewer that provide feedback on when they are done.

I am suggesting that they implement milestones and do more to follow up on contracted jobs so their tracking is accurate.

Thank you for your feedback!
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