Total Project Control

APM utilizes a revolutionary new approach to planning, scheduling, costing and tracking called Total Project Control. The TPC method, the subject of a new book published in May 1999 by John Wiley & Sons, allows both an individual project, and an organization's entire project portfolio, to be planned and tracked on the basis of revenues and profitability.

By enhancing the methods of "traditional" project management, and introducing new techniques, concepts, and data items, TPC provides quantified profitability data in support of such management decisions as:

Product design, scheduling, and budgeting.

Setting of project deadlines.

Scope adjustments in response to slippage or market changes.

Project priorities based on maximized portfolio value.

Staff "rightsizing" based on dollarized cost of bottlenecks.

R&D budgets justified through NPV and risk management.

Setting of corporate quality standards.

Evaluation of project management performance.

It is a truism of total quality management that what can be measured can also be improved. The ultimate goal of TPC is a corporate culture in which each project team member, every project manager, and every executive is working toward maximized profitability, not just for the individual project but across the entire corporate portfolio.

Take, for example, the case of the senior manager with the project portfolio shown below:

Proj. Name	Expected Value (000)	As Of	Current Comp Date	% Loss per week late	% Gain per week early	Cost ETC	Simple DIPP
A	$1,000	Aug 1	Aug 1	5%	5%	$200	5.0
B	$2,000	Oct 1	Oct 1	10%	5%	$1,000	2.0
C	$5,000	Nov 25	Nov 25	20%	2%	$2,000	2.5
D	$10,000	Jan 30	Jan 30	10%	5%	$3,000	3.3
Total Portfolio:		Expected Value: $18,000
		Cost ETC: $6,200
		Expected Net: $11,800
		Simple DIPP: 2.9

The data above are a subset of the standard data provided by the TPC methodology. With these, the manager can forecast profits and revenues, measure the impact of resource shortages or other delays, and even weigh hiring or outsourcing decisions on the basis of profitability impact.

But what happens when the following addition to the project portfolio is suggested?

Proj. Name	Expected Value (000)	As Of	Current Comp Date	% Loss per week late	% Gain per week early	Cost ETC	Simple DIPP
E	$12,000	Feb 10	-	20%	5%	$3,000	4.0

Without access to TPC data, the manager will probably take on what seems like a profitable new project. And when profits decrease, it will be blamed on bad luck, or poor project management, rather than the simple lack of adequate data, as shown on the next page.

TPC mandates that project data must be analyzed across the entire portfolio. And, unfortunately, when Project E is added to the portfolio, its impact on the organization's limited resource pool delays all the other projects, with the following result:

Proj. Name	Expected Value (000)	As Of	Current Comp Date	% Loss per week late	% Gain per week early	New Exp. Value	Cost ETC	Simple DIPP
E	$12,000	Feb 10	Feb 10	20%	5%	$12,000	$3,000	4.0
A	$1,000	Aug 1	Aug 29	5%	5%	$800	$200	4.0
B	$2,000	Oct 1	Oct 29	10%	5%	$1,200	$1,000	1.2
C	$5,000	Nov 25	Dec 16	20%	2%	$2,000	$2,000	1.0
D	$10,000	Jan 30	Mar 13	10%	5%	$4,000	$3,000	1.3
Total Portfolio:		Expected Value: $20,000 (+ $2,000)
		Cost ETC: $9,200 (+ $3,000)
		Expected Net: $10,800 (- $1,000)
		Simple DIPP: 2.2 (- 0.7)

Despite the fact that the new project is very profitable, the TPC data clearly show that the organization's resource limitations will drive profits down, not up, unless changes are made to the plans for the existing projects.

Fortunately, other TPC data are available at the level of the individual project. These data can help point the project managers in the right direction, targeting the optimum activities for shortening durations, adding resources, or trimming work scope. Again, these are data that traditional project management methods and software do not provide. Most project managers would be hard pressed to determine which activity in the network logic diagram on the next page is causing the most delay.

But TPC's DRAG calculation (above) shows that Activity B is adding 18 days to the project's critical path, far more than any other task. Can something be done to remedy this? TPC's Net Value-added and CLUB data items help the project managers optimize each project's plan. Then senior management's multiproject data suggests a new portfolio profile:

Proj. Name	Expected Value (000)	As Of	Current Comp Date	% Loss per week late	% Gain per week early	New Exp. Value	Cost ETC	Simple DIPP
E	$12,000	Feb 10	Jan 13	20%	5%	$14,400	$3,500	4.1
A	$1,000	Aug 1	Sep 12	5%	5%	$700	$200	3.5
B	$2,000	Oct 1	Oct 15	10%	5%	$1,600	$1,000	1.6
C	$5,000	Nov 25	Nov 25	20%	2%	$5,000	$2,000	2.5
D	$10,000	Jan 30	Feb 27	10%	5%	$8,000	$4,000	2.0
Total Portfolio:		Expected Value: $29,700 (+ $9,700)
		Cost ETC: $10,700 (+ $1,500)
		Expected Net: $19,000 (+ $8,200)
		Simple DIPP: 2.8 (+ 0.6)

The above table shows that by increasing the budgets for Projects D and E by a total of $1.5 million, a multiproject schedule can be implemented that can generate $8.2 million in additional profits. Would this be the optimum profile? Is the cash flow available to increase expenditures in such a way? Such questions can only be answered through further analysis. But only TPC provides the data for such analysis, across work scope, schedule and cost, as well as across all projects in the organizational portfolio.

Without such data, even the questions are unknowable.