The History of Project Controls

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This subject provides a general overview of the development of project control techniques from bar charts through to modern optimization and integration (BIM). The origins of specific techniques are discussed as separate subjects below.

Topics included in The History of Project Controls:

- The History of Scheduling
- The Origins of WBS
- The History of Cost Controls
- The History of Earned Value Management
- Developments in the Creation and Use of Controls Information
 

Other related sections of the PMKI:

- Project controls and scheduling; current practice
- The origins of CPM, PDM and PERT schedules
- Henry L Gantt (and why bar charts are not 'Gantt Charts')



The History of Scheduling

UNIVAC 1

The science of ‘scheduling’ as defined by Critical Path Analysis (CPA) has its origins in 1956/57 when Kelly and Walker started developing the algorithms that became the ‘Activity-on-Arrow’ or ADM approach to CPM for DuPont. The program they developed was trialed on plant shutdowns in 1957 and the first paper on critical path scheduling was published in 1958. The PERT system also used the ADM notation, and was developed at around the same time but lagged CPM by 6 to 12 months (although the term ‘critical path’ was invented by the PERT team). Later the Precedence (PDM) methodology was published by Dr. John Fondahl in 1961 as a ‘non-computer’ alternative to CPM. Arguably, the evolution of modern project management is a direct consequence of the need to make effective use of the data generated by the schedulers in an attempt to manage and control the critical path [see: The Origins of Modern Project Management].

The evolution of scheduling closely tracked the development of computers. The initial systems were complex mainframe behemoths, typically taking a new scheduler many months to learn to use. These systems migrated to the ‘mini computers’ of the 1970s and 80s but remained expensive thereby encouraging the widespread use of manual scheduling techniques, with only the larger (or more sophisticated) organizations being able to afford a central scheduling office and the supporting computer systems. The advent of the ‘micro computer’ (ie, personal computer, or PC) changed scheduling for ever. Some of the first commercial software for this class of computer was developed by Micro Planning Services in the UK running on an Apple II. Micro Planner v1.0 was released in 1980 after 14 months development [see more on the history of Micro Planner].

The first IBM PC was launched in 1981; although the definitive IBM XT was not launched until 1983. ‘Windows’ type operating systems became available in 1984 (Apple Macintosh) with ‘Windows v1.0’ (Microsoft) launched in November ‘85. The rapid spread of relatively cheap, easy-to-use PCs spawned dozens (if not hundreds) of PC based scheduling systems including TimeLine, CA Superproject and Primavera. Most of the dominant scheduling software tools available today emanate from this period. By way of example, Primavera was founded in May 1983, the original software being converted from a mainframe batch entry system. Today Primavera is arguably the dominant ‘high end’ project scheduling tool world wide. The evolution of PC based scheduling moved project controls from an environment where a skilled cadre of schedulers operating expensive systems made sure the schedule was ‘right’ (and the organization ‘owned’ the data) to a situation where anyone could learn to drive a scheduling software package, schedules became ‘islands of data’ sitting on peoples’ desktops and the overall quality of scheduling plummeted. Current trends back to ‘Enterprise’ systems supported by PMOs seem to be redressing the balance and offering the best of both worlds. From the technology perspective, information is managed centrally, but is easily available on anyone’s desktop via web enabled and networked systems. From the skills perspective PMOs are re-developing career paths for schedulers and supporting the development of scheduling standards within organizations.

This section provides a holistic overview of the origins of dynamic scheduling and schedule management. The development of the three types of network diagram CPM, PDM and PERT Schedules are covered in their own sections:




PP: The Origins of Schedule Management. The concepts used for project schedule management have very deep roots. This paper traces the development of the concepts most project managers take for granted including bar charts and critical path schedules from their origins (which are far earlier than most people think) through to the modern day.

PP: A Brief History of Scheduling. This paper tracks the development of scheduling from the emergence of 'bar charts' at the end of the 18th Century through to present times and looks at the way the evolving technology has changed the way projects are scheduled and managed.
Art: A Brief History of Scheduling (short summary).

The 1910 Schürch barchart referenced in the 'History of Scheduling' paper: These are fully developed, sophisticated project control tools in use many years before the work of Henry Gantt was published.

PP: The Origins of Bar Charting. This paper looks at the ancient Greek and Egyptian origins of the concepts used by both Priestly and Playfair as a starting point to develop their charts which in turn led to the development of the modern bar chart by the late 1800s.

Art: The origins of PERT and CPM. ‘What came before the computers’. This article looks the origins during and after WW2 of the mathematics and activity-on-arrow (ADM) drawing styles used in both PERT and critical path (CPM) schedules.

Pert-Cost

Art: The Origins of Hammocks and Ladders. Hammock and Ladders are activity types that were developed in the period 1961 to 1965. This paper outlines the development of these useful scheduling assets an differentiates Hammocks from LOE and Summary activities.
See also extracts from the ICL 1900 PERT manual Circa. 1968. For more on the history of ICL see our blog: ICL 1900-PERT-50th-anniversary/ 

The story of Micro Planner - one of the first scheduling tools developed for personal (micro) computers: see the timeline

What scheduling looked like in 1979 - The development of Micronet for the Apple PC. An analysis only required 6 hours..... See: https://www.praxisframework.org/en/resource-pages/dooley-what-scheduling-looked-like-in-79

Information on applying critical path scheduling to modern projects has been consolidated into an easy-to-read book Easy CPM.

Easy CPM Easy CPM is a course-in-a-book that provides practical training and guidance to individuals and organizations involved in developing or using CPM schedules based on the Critical Path Method (CPM). It is designed to act as both a reference, and practice guide, for people implementing CPM scheduling after they have learned to use the CPM scheduling software of their choice.

See more, free preview and buy ($35, immediate download).

Click through to our page focused on scheduling.

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The Origin of Work Breakdown Structures (WBS)


PP: The Origins of WBS & Management Charts.
WBS Sample The purpose of this paper is to consolidate the available information on the creation and evolution of the work breakdown structure (WBS), and three business charts that may have led to the creation of the WBS.

It is generally accepted the concept of the WBS was not developed until 1957, and the WBS is predated by Organization Charts (1854), Cost Breakdown Structures (1909), and Flow Charts (1921) - see below for links to resources and full size diagrams.

Download the full paper

While the roots of a WBS chart may well be found in the various forms of chart outlined below, the development of the WBS concept appears to have occurred as part of the Program Evaluation and Review Technique (PERT). While the term "work breakdown structure" was not used in by the PERT team, the first implementation of PERT did organize its tasks into product-oriented categories
(see more on the development of PERT).

In June 1962, DoD and NASA published a document describing the PERT/COST system which defined the structure and use of the WBS, nothing much has changed since:

WBS from PERT-COST

For more on PERT/COST see the History of Earned Value below.

The concept of the WBS was standardized by the publication of MIL-STD-881 on 1 November 1968 by the USA Dept. of Defense. This was followed by  MIL-STD-881A on 25 April 1975; this standard has been progressively updated since. Download a copy of MIL-STD-881A.

The first Australian standard for WBS was DEF(AUST) 5664, August 1995: Work Breakdown Structures (WBS) for Defence Materiel projects.

Click through to see more on project breakdown structures in the contemporary section of the PMKI.

 

Organization Charts

The Scottish-American engineer Daniel McCallum (1815–1878) is credited for creating the first organizational charts of American business around 1854. While McCallum’s diagram is rather artistic, more WBS like charts were developed early in the 20th century (although not widely used).

Org Chart 1Org Chart 2

 








Click on either chart to download a larger version.
Source Wikipedia.

Footnote: The Tabulating Machine Co. (above) was one of the companies that merged to become IBM.
Click to open a brief timeline provided by Dr. Mihail Sadeanu.

The continuing usefulness of org-charts in the 21st century, given the shift towards 'flat' organization structures, agility, and self management is considered in Are organization charts still useful?


Cost Breakdown Structure

One of the earliest diagrams of a breakdown structure I've been able to find is from a 1909 book Construction Cost Keeping and Management.

1909 Cost Chart

The use of charts to display complex financial and other data was well understood by the start of the 20th century. Charting was an important part of the work of Henry Gantt (see more), and How to make & use graphic charts by Allan C. Haskell was published in 1919.

 

Flow Charts & Process Charts

A few years later, Process Charts were developed and publicized by Frank and Lillian Gilbreth in their 1921 presentation to The American Society of Mechanical Engineers. Process Charts morphed into Flow Charts relatively quickly and were considered normal business diagrams well before the concept of a ‘flow chart’ was used to underpin the PDM network notation developed by Dr. John W Fondahl in 1962 [see more on the development of PDM schedule networks].

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The History Cost Controls

Origins of Cost Engineering

The functions of cost estimating, cost control and accounting extend back into antiquity. However the discipline of cost engineering appear to be much later development starting in the 19th century, followed by earned value management in the 20th century.

PP: The Origins and History of Cost Engineering. Cost Engineering, the application of cost estimating, cost management, and engineering economics to capital asset management, has a long history. This paper will chart the evolution of cost control from its beginnings as an accounting function, through its use as a performance motivator through to the emergence of Cost Engineering as a distinct discipline in the first half of the 20th Century. It reviews notable developments and leaders in these fields prior to 1960.

References used:
Treatise on Canals and Reservoirs, by J. A. Sutcliffe, published by Law and Whittaker, London, 1816.

The Iron Age What is an Engineer-Constructor? Article by George A. Damon (USA 1906).

Cost Keeping and Management Engineering: A Treatise for Engineers, Contractors and Superintendents
   Engaged in the Management of Engineering Construction, by Halbert P. Gillette & Richard T. Dana.
   (USA 1909).

A Manual of Planning & Progress for Construction Operations: United States War Department.
   Construction Division of the Army, by Earle B. Morden (USA 1920).

Manual of Financial and Accounting Procedures for Public Bodies (USA, 1934).

The Wheeler Project, Comprehensive Report on the Planning, Design , Construction, and Initial Operations
   of the Wheeler Project. Tennessee Valley Authority, USA 1940.

The Early History of Cost Engineering by John K. Hollmann.
 

Art: Incentive Payment Schemes. The first linking of payment and performance extends back 100s of years. The payment of  'piece rates' to stone masons, weavers, and other artisans being a set price paid for each 'piece of work' produced. The phrase 'piece work' first appears in writing around the year 1549, but the practice may be older. For example, the 1306 contract between Richard of Stow, mason, and the Dean and Chapter of Lincoln Cathedral, specified that the plain walling would be paid for by measure, and indeed banker marks (identifying who cut the stone) are found on the blocks of walling in this cathedral.

PP: Cost Overruns on Early Canal & Railway Projects. WagonwayThe difficulties in determining a realistic cost for a new class of project are understandable. But, transport projects in the United Kingdom (UK) predate the industrial revolution by several centuries. This suggests that in addition to the lack of empirical cost information, the problem with the cost estimates identified in The Origins and History of Cost Engineering may have been caused by various combinations of poor governance, questionable ethics, and optimism bias. The same set of issues that continue to plague many modern megaprojects.

PP: The First Railway Projects. Transport projects in the United Kingdom predate the industrial revolution by several centuries. This paper will look at the building of some of the earliest railway projects (horse drawn wagonways) to identify where possible the contractual and management processes used in their construction and their influence on the industrial revolution.

PP: The First Canal Projects Until the introduction of efficient steam-powered railways, canals were the driving force behind the industrial revolution.  This paper looks at the development of canals in the UK from Roman times through to the start of the 'canal mania' in the 1790s, and seek to identify where possible the contractual and management processes used in their construction.

Blg: Transport project cost overruns are not new! The questionable ethics around the funding of some canal development in England 1760 and 1830 are highlighted.
This post is based on Treatise on Canals and Reservoirs, by J. A. Sutcliffe, published by Law and Whittaker, London, 1816. Download the book.

Note: Governance mechanisms for companies companies were first legislated several years after the Treatise was published; see more on the history of governance.

Click through to our page on project cost controls.

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The History of Earned Value Management & PERT/Cost

EVM ChartThe fundamental difference between cost engineering discussed above and earned value management is the way information is used. Both approaches estimate the expected future cost of the works and both collect and compare actual costs with both the estimated value of the work accomplished, and assess the difference between the work actually done, and the work planned to have been done as at a point in time. The difference is cost engineering identifies problems for management to resolve, it is passive and reactive; based on financial accounting information. Where as Earned Value incorporates a structured forecasting process.

Earned Value Management has three fundamental components:

  1. All of the resources and work planned and used in the course of a project is reduced to a single metric (usually monetary value as at a baseline date), this includes labor, materials, suppliers, subcontractors and overheads.
  2. The work is planned, and progress measured based on the ‘metric’ to derive the planned and earned ‘values’, for the scope of work. Actual costs are accumulated on the same basis as the planned and earned values which usually requires adjustments to the raw financial data.
  3. As work progresses, the current difference between planned and actual performance (as measured by the metric) is used to forecast future outcomes.

The concept of EVM did not suddenly appear, its foundations were laid by previous generations. EVM is a synthesis of ideas and concepts some of which are hundreds of years old. The four precursors to EVM are:

  1. The use of computers to calculate time schedules (CPM and PERT), see The History of Scheduling.
  2. Sophisticated engineering cost controls, see The History Cost Controls.
  3. The use of breakdown structures to aid management, see The Origin of Work Breakdown Structures (WBS), and
  4. The emergence of the concept of modern project management, Origins, and trends in, modern project management

PP: The Origins and History of Earned Value Management. The purpose of this paper is to outline the development of Earned Value and Earned Schedule. The concept of project controls has a long history of continuous development and innovation, however, the use of deterministic information to predict future outcomes only appears to have started started in the late 1950s with PERT and CPM, and progressed through PERT-COST to the point where there is general acceptance that Earned Value Management and Earned Schedule are the best of the predictive control tools. 

Blg: The Origins + History of Earned Value Management. This post covers the inputs to the creation of EVM as described in The Origins and History of Earned Value Management.

Prs: The Origins of EVM. A PowerPoint overview of the development of EVM from the 1950s to 2021 extracted from the main paper during development.

PP: Earned Schedule - the First 20 Years. The purpose of this paper is to outline the development of Earned Value and Earned Schedule.

PP: Earned Value Management – Early Computers. The use of mainframe computers in the 1960s was integral to the development of Earned Value Management. This paper looks at some of the earliest developments.

Prs: Earned Value Management – Past, Present & Future. An overview of the development of EVM, the current state of development, and some thoughts about using EVM in a future integrated design and controls system.

 

Referenced Resources available for download

Pert-CostDP: USAF PERT COST System Description Manual.  This is Volume III of the USAF PERT series, as at March 1963. It contains a detailed description of the USAF PERT Cost System. It provides methodology and guidance and serves as a reference for all levels of management in the application of PERT Cost. 

DP: DOD NASA PERT COST Output Reports.  Supplement No.1 to DOD and NASA Guide, PERT COST Output Reports, March 1963. Defines the standard reporting formats to be used by a PERT COST system. 

DP: The 1964 Evaluation of PERT/Cost. This original paper looks at the challenges of assessing the business value of using the PERT/Cost system following its introduction in 1963/64.  The report findings are still relevant! 

Click through to see more on PERT/Time


Key papers and articles referenced in The Origins and History of EVM:
 
Earned Value Management — Reconciling Government and Commercial Practices.
   Abba, W.F., PM: Special Issue January - February 1997.

Cost Data Base Development - A Twelve-Year Perspective.
   Leggitt, A.C., October 1981.  

USAF Oral History, interview with Lieutenant General Hans H. Driessnack (1987)
   His involvement in PERT/COST, C-Spec and C/SCSC start at page 105 of the full interview.

Cost/Schedule Planning Control Specification,
   Lorette, R.J., Roth, B.J., The Air Force Comptroller Vol.4 No.1, Jan 1970.

DOD's 5000 Documents: Evolution and change in defense acquisition policy.
   Ferrara, J.,  Acquisition Review Quarterly—Fall 1996.

PERT Time/Cost; An Aid to Agribusiness Management.  Ken D. Duft

Progress Report on Martin's Titan III Incentives (January 1963 to March 1966), Chapman, R.W.

How It All Began: The Creation Of Earned Value And The Evolution Of C/SPCS And C/SCSC.
   Measurable News 2016-01. Morin, B.J.

DODI 7000.2, June 10 1977: Performance Measurement for Selected Acquisitions.
   Including Cost/Schedule Control Systems Criteria at Encl. 1.

Performance Measurement Systems, Recent Systems Development and Applications.
   Rigney, R.A. 1979.

DODI 7000.10 December 3, 1979:
   Contract Cost Performance, Funds Status and Cost/Schedule Status Reports.

ANSI/EIA-748:1998 Earned Value Management Systems

PARCA - EVM Application & the updated DoDI 5000.02 2017.
   See also DoD Earned Value Implementation Guide.

Schedule is Different. The seminal paper introducing Earned Schedule, Lipke, W., 2003.

DEF(AUST) 5655, October 1992: Australian Cost/Schedule Control Systems Criteria

DEF(AUST) 5657, March 1994: Australian Cost/Schedule Control Systems Criteria
   Implementation Guide

DEF(AUST) 5658, February 1994: Cost/Schedule Status Reporting (CSSR) Specification and
   Implementation Guide

DEF(AUST) 5664, August 1995: Work Breakdown Structures (WBS) for Defence Materiel projects

AS 4817:2003 Project performance measurement using Earned Value.

-  Performance Management Association - President's Report / History, 22 March 1987

The two controls capabilities needed for effective project management in the current era are a good schedule supporting a sensible earned value management system (EVMS). The information needed to apply these concepts to modern projects has been consolidated into two easy-to-read books Easy EVM and Easy CPM:

Easy EVM + CPM Both are designed as a course-in-a-book to provide practical training and guidance to individuals and organizations involved in developing or using, either earned value management, or CPM schedules based on the Critical Path Method (CPM).



Easy CPM is designed to act as a reference and practice guide for people implementing CPM scheduling after they have learned to use the CPM scheduling software of their choice.
See more, free preview and buy $35, immediate download).

Easy EVM is designed to provide practical guidance to people, and organizations, involved in either implementing an earned value management system, or using information created by an earned value management system. It provides guidance on concepts, responsibilities, integration, and processes, for the implementation and use of earned value management based on ISO 21508.
See more, free preview, and buy ($35, immediate download)

 

Visit our EVM resources and training page.

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Developments in the Creation and Use of Controls Information

Prs: Seeing the Road Ahead - the challenge of communicating schedule data. This presentation looks at the challenges faced by project controls professionals, both in the past and present times, to communicate sophisticated information to other members of the project team and their stakeholders and some of the tools and processes they used.

Blg: Predicting Completion. When did managers start using data to calculate project completion times and costs? It would appear to be a development of the 1950s.

Blg: The three phases of project controls. The reactive, empirical and predictive phases of project controls (see also Predicting Completion).

Click through to our page on integrated project controls.   

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