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    MB0049-Project Management

    Unit-11 Project Performance Measurement and Evaluation

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    Program : MBA

    Semester : II

    Subject Code : MB0049

    Subject Name : Project Management

    Unit number : 11

    Unit Title : Project Performance Measurement and

    Evaluation

    Lecture Number : 11

    Lecture Title : Project Performance Measurement and

    Evaluation

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    Project Management

    Objectives:

    After studying this unit, you should be able to:

    Explain the concept of performance measurement Define productivity

    Know the essentials of project performanceevaluation

    Identify the benefits and challenges of performanceand evaluation

    Describe the key steps and approaches for effective control of project

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    Introduction

    Performance measurement and evaluation are important aspects in anyproject management process.

    Performance measurement is the ongoing, regular collection of informationfor monitoring how a project, policy, or strategy is doing. It is a systematicway of mapping the evidence of the progress you are making towards yourexpected results.

    Evaluation involves comparison of performance with the objectives of theclient organisation and determining the change if any, to ensure whethersuch changes are in the best interest of project itself.

    In this session, you will about performance measurement, productivity,project performance evaluation, types and process of project performanceevaluation, benefits and challenges of performance measurement andevaluation, and controlling the projects.

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    Performance Measurement

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    Pre-established performance measurement is an ongoing process whichinvolves monitoring and reporting of project progress with respect to

    predetermined objectives.

    The following are the key characteristics of performance measurement:

    It comprises the monitoring and reviewing of project accomplishmentsand progress towards pre-determined goals.

    It facilitates us to decide how well the information system, service orresource is operating, compared with some theoretical maximum.

    It helps in assessing how a resource or service is performing and, alsoacts as an accountability factor to the stakeholders.

    It is an important technique for establishing the "value" of informationservices to the intended customers or funding authorities.

    It is a part of the strategic planning process and is used as an importantfeedback mechanism to support decision making in libraries.

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    Unit-11 Project Performance Measurement and Evaluation

    Performance Measurement (cont.)

    The various performance measures and their roles are:

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    PerformanceMeasures

    Role of Performance Measures

    Effectiveness This indicates the degree to which a process output,

    i.e., a service or product conforms to the set

    requirements.

    Efficiency This indicates the degree to which the required serviceor product is produced.

    Quality This measures the degree to which a service or

    product meets the requirements and expectations of

    the user.

    Timeliness This measures if the product or service was provided

    on time.

    Productivity This is calculated by dividing the value added by the

    product or service by the value of labour and capital

    cost.

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    Productivity

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    Productivity is the general term everyone uses to describe the balancebetween quantity and quality.

    Productivity is calculated by dividing the value added by the product orservice by the value of labour and capital cost. It is the output of a givenquantum of inputs.

    By using the coefficient of productivity, we can measure the performance forthe total enterprise or for the individual factors of production.

    If the productivity is measured for the total enterprise, it is termed as totalfactor productivity; and when it is measured for each factor, it is termed aspartial factor productivity.

    Productivity is always a relative measure and expressed as the ratio of netoutputs to inputs.

    Performance coefficient of productivity can be measured in financial as wellas physical terms. It could be the net output by value or physical quantity.

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    Project Performance Evaluation

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    Performance evaluation is an important tool for the assessment of a system orservice according to the measurements specified.

    Evaluation is planned from the beginning of the project, and normally includesthe following steps:

    1 It establishes accurately what is to be evaluated and how past outturns

    can be measured.

    2 It chooses the alternative condition of the world and/or alternative

    management decisions as counterfactuals.

    3

    It evaluates the actual outcome with the target outcome, and with theeffects of the chosen alternative condition of the world.

    4 It provides the results and recommendations.

    5 Disseminates the results and recommendations.

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    Types-Project Performance Evaluation

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    The following are the types of project performance evaluation techniques:

    Process evaluation

    Outcome evaluation

    Impact evaluation

    Cost-benefit and cost-effectiveness analysis

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    Process-Project Performance Evaluation

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    Process of project performance evaluation is very useful tool to find out thereasons behind a failure to achieve intended outcomes.

    The modifications that need to be made to a project can be determined byfollowing the below steps:

    Project identification

    Pre-feasibility studies

    Executive summary

    Detailed project report

    Appraisal and evaluation

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    Benefits of Performance Measurement

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    The benefits of performance measurement and evaluation are:

    Benefits of

    Performance

    Measurement and Evaluation

    Policy and

    programme

    planning and

    development

    Results may confirm policy and programme direction or

    identify gaps that need to be addressed.

    Decision making

    about funding

    Finding out what works well/not so well can be used to

    guide future funding decisions/priorities.

    Clarifying goals At the outset, developing a road map clarifies goals,

    explains the big picture and ensures that everyoneshares a common focus.

    Tracking

    progress

    Enables monitoring and if required, permits adjustments

    to be made along the way.

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    Challenges of Performance Measurement

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    Several performance measurement and evaluation challenges related toaddressing labour violence may include:

    The multi-dimensional nature of violence because of individual family influences

    The developing multi cultural misrepresentations leading to communal chaos

    Dissimilar operational policy environments and priorities in various jurisdictions

    The unexpected and incidental forces of different people from different

    background, culture and community settings

    The level of investment (either resources or time) requisite to buildcollaborative efforts and build confidence to address such issues

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    Controlling the Projects

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    Controlling the project is an independent function in project management. Itapplies verification and controlling function throughout the processing of a

    project in order to emphasize the defined performance and formal objectives.

    The controlling role basically consists of the following four steps:

    Establishing tasks/performance standards

    Measure actual performance

    Compare the actual performance with the target and find the duration

    Take appropriate action to see that the /desired result is achieved

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    Controlling the Projects (cont.)

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    Control of major constraints time, cost and qualities

    Control systems are required for assessment of cost, time, risk, quality,communication, procurement, and human resources.

    A control system controlling time, cost and quality can be shown as:

    Integration of all activities

    Monitoring reference

    Updating plan

    Evaluating preference

    Take correct time active

    Report feedback and feed forward

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    Controlling the Projects (cont.)

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    Design of control system

    Design of an integrated control system for time, cost, and quality includes:

    1 Planning stage

    2

    Scheduling of resources and time

    3 Organising

    4 Budgeting

    5 Time and cost control

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    Controlling the Projects (cont.)

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    Approaches to project control

    The key approaches to project control are:

    Project controlapproaches

    Variance analysis Performance analysis

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    Summary

    Pre-established performance measurement is an ongoing process whichinvolves monitoring and reporting of project progress with respect to

    predetermined objectives.

    Productivity is the general term everyone uses to describe the balance betweenquantity and quality.

    Performance evaluation is an important tool for the assessment of a system orservice according to the measurements specified.

    Process of project performance evaluation is very useful tool to find out thereasons behind a failure to achieve intended outcomes.

    Controlling the project applies verification and controlling function throughoutthe processing of a project in order to emphasize the defined performance andformal objectives.

    Control systems are required for assessment of cost, time, risk, quality,communication, procurement, and human resources.

    Design of an integrated control system for time, cost, and quality includesplanning stage, scheduling of resources and time, organising, budgeting, timeand cost control.

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    Check Your Learning

    1. Name the key approaches to project control.

    Ans: The key approaches to project control are:

    a. Variance analysis

    b. Performance analysis

    2. List the various types of project performance evaluation techniques.

    Ans: The various types of project performance evaluation techniques are:

    a. Process evaluation

    b. Outcome evaluation

    c. Impact evaluation

    d. Cost-benefit and cost-effectiveness analysis

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    Activity

    HOMEPREVIOUS

    Assume that you are a project manager in a IT company. You have toevaluate the performance of a project that has to be delivered to client.What are the various types of evaluation techniques you would follow?