Estimated reading time: 5 minutes
Introduction
Q: We asked procurement professionals to think about a project they’re currently working on or a project from the past. We then asked them how believable they thought the delivery schedule was.
A: The result was that only 14% of the respondents believed that the delivery schedule could be achieved.
From this, we can see that delivery schedules have a lack of believability. But for what reason and what can we do to ensure they are believable going forwards?
Why do schedules lack believability?
Frankly, in a procurement context globally, bidders are incentivised in a bidding scenario to downplay the risks and to promise us the moon, because that’s what we’re asking for. The nefarious view is that they know they’re not going to be held to account because there’s enough wiggle room in the statement of work and enough ambiguity, so if things change, they can avoid any accountability. We don’t often include contractual obligations and penalties for late delivery, sometimes we can and do, but on large complex projects, it’s very hard to properly hold them to account. They know that and they will work towards that. Now, not all bidders are nefarious like that, most aren’t. They don’t know everything, and you don’t know everything, they want to give you that promise that you’re asking for and you’re incentivising them to do that.
What are the attributes of a believable schedule?
So how do we get to a “good” level? There are three main types of attributes that make a schedule believable.
1. Complete schedule
First is the schedule should be complete, what we mean by that is that it needs to reflect all the work that is in the statement of work, everything that you’re asking them to do has got to be included in their schedule. We also want them to identify risks and include the mitigations in their schedule. Well, this might be delayed and therefore we’re going to have to subcontract that. We want to see those mitigations in the schedule for high-risk items and we want their schedule to be complete in that it aligns with their wider proposal. So, when they say there’s 10 people painting the walls, they need to have 10 people in their resourcing to show that they can do that. It needs to align with the resourcing, their costing and their wider technical proposal and it needs to be complete.
2. Well-designed schedule
The second attribute is it needs to be well designed and what I mean by that is it uses scheduling software. So, they need to be using a software tool, it’s not the first time they’ve used it, they have a history of using these tools and know the methodologies of scheduling and the whole estimating process. You want them to use proper professional scheduling techniques, this is not something done on a cocktail napkin.
You want them to look at the critical path, near critical path activities, those are probably the ones that are going to get you. An example is the DMCA 14-point assessment, it’s a US department for project management. We’ve seen it used in many other jurisdictions where it tests a schedule, looking at things like the logic, the amount of float, the number of constraints, the critical path line index that will give you a parametric view and objective view as to the quality of a schedule. Is it well designed if it passes these tests?
Also, we want bidders to test their schedule, a good believable schedule has been tested using a PERT methodology or Monte Carlo simulations. We’re seeing the industry standards at P80 which is a good level of confidence, an 80% probability that you’ll achieve that schedule, or lower. The UK Ministry of Defence had been using P50, a very recent parliamentary committee stated its too low confidence, we expect to see a move up to P75.
3. Relevant and appropriate
We also want to see schedules that are relevant and appropriate so that there’s justification that it fits a reference class for what you’re building. We want to see the provenance of the estimates, where did it come from? The estimates of how long it’s going to take or what the risks are, what are the dependencies. We want to see primary data sources put together by real subject matter experts and that they define and justify the relevance of what they’re doing for you, what they’re proposing to do for you now and how that aligns with a reference class that are similar from the past. So, what we’re trying to get is schedules that have these attributes.
Conclusion
A successful project schedule not only needs to be complete, encompassing all aspects of the statement of work and aligning with the broader proposal, but it must also be well-designed, employing professional scheduling techniques and subjected to rigorous testing. The utilisation of scheduling software, adherence to industry standards and validation through methodologies like PERT or Monte Carlo simulations contribute to the credibility of the schedule. Furthermore, the schedule should be relevant and appropriate, grounded in primary data sources provided by subject matter experts and justified based on its alignment with reference classes from similar past endeavours. By demanding schedules that embody these attributes, we ensure a foundation for project success built on thoroughness, professionalism and contextual appropriateness.
