Some interesting Project Life Cycle Variables
In our last two pages we discussed PLC and observed the hierarchical
nature of its components. In many ways, the things that make project
management unique as a discipline can only be displayed in the PLC
sequence. Many of the process features of project management exhibit
marked and characteristic variation during the course of the PLC,
thus making project management more complex and success more difficult
to attain. Figure 4 shows two variables which
are briefly described as follows.
Figure 4: Two Variables
Potential for Adding Value
The potential for adding value to the products of a project are
obviously highest during the conceptual phase of the project and
lowest during the finishing phase. Between these two extremes, the
curve tends to follow a reverse "S" curve as shown in
the figure.
Escalating Cost to Change or Fix
Conversely, the cost of making changes is lowest in the planning
phases, but rises more and more steeply as the project progresses
through the two production phases. In construction, for example,
it has been suggested that the cost to make a change, or fix a non-conformance,
increases by ten times through each succeeding major phase.
Adding Value vs. Cost to Change
If the Cost-to-Change curve is considered in conjunction with that
of Adding-Value, the implications to management decision making
become readily apparent. The intersection of the two curves probably
represents the point at which a change in scope changes from a constructive
opportunity into a destructive intervention.
On this issue, Boznak makes a powerful argument in favor of complete
and early planning to eliminate later changes. In drawing a comparison
between North American and Japanese practice he stated:[7]
Japanese manufacturers achieve project control much earlier than
U.S. manufacturers. In fact, the U.S. (approach) corresponds with
the ... philosophy ingrained in many of today's largest companies
'We'll know it when we see it.' A significant advantage of early
project control is that it creates a plateau of stability
to facilitate productivity improvements ... (and earlier delivery)
... . When projects are not well managed, assigned resources
have a difficult time establishing their work priorities. As a
result, program instability is subconsciously factored into functional
estimates ... ."
7. R.G. Boznak, Project Management
Journal, September 1991, p13.
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Project
Life Cycle Hierarchy
