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Using the earned value management report

Using the earned value management report

In the reports tab, you find the earned value management report. We think this is very important and above all, very much appreciated by your manager. We also made it part of the Highlight Report you can find in our e-course Cost Management (Pro course).

The new term EAC is also explained here. This stands for the Estimate At Completion. In other words, if we extrapolate the current progress against the baseline to the end of the project, this will be the total costs of the project (16-17 days for ten paintings at my hourly rate).

Using the earned value management report3

Earned Value over Time

The graph Earned Value over Time shows the earned value of the project based on the status date.

  • If the actual costs (ACWP = blue) are higher than the earned value (BCWP = orange), the project budget has been exceeded. For example, I have painted three paintings for a higher hourly rate.
  • If the scheduled value (BCWS = gray) is higher than the earned value (orange), the project is behind schedule. For example, I have finished less paintings than I expected to have on this (status) date.

Using the earned value management report

Variance over time

The graph Variance over time shows costs and efficiency variances for the project based on the status date.

  • If CV (cost variance, the price difference) is negative, the project is exceeding budget. For example, I have painted three paintings for a higher hourly rate.
  • If SV (schedule variance, the efficiency difference) is positive, the project is behind schedule. For example, I have finished less paintings than I expected to have on this (status) date.

Using the earned value management report1

Indices over time

The graph Indices over time shows the performance index for cost and schedule based on the status date. The greater the performance index, the better the project is on schedule (SPI) and the more costs are saved (CPI).

Using the earned value management report2

So what do you need to get these amazing reports?

Let us consider the following example: 

I have to make ten paintings (scope) in ten days (duration). We sell them at $100.- each (cost information). At the end of day 5 (status date) I finished only 3 paintings (progress information).

 

What do you need in our schedule?

  • Baseline scope and duration: ten paintings in ten days
  • Cost Information: Selling price of $100.- each
  • Status Date
  • Progress information: Marking tasks complete

Do you use or do you consider using earned value management techniques in your MS Project schedule?
Share it in the comments below.

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View duration of tasks vs. baseline

View duration of tasks vs. baseline

In our e-course we’ve created a custom view to compare the Duration Tasks vs. the BaselineIn this view you can learn from your actual progress. The smileys will tell you how your duration is doing compared to the (current) baseline. 

View duration of tasks vs. baseline

 

2c. Duration Tasks vs. Baseline

View duration of tasks vs. baseline2

Go to view 2c. Duration Tasks vs. Baseline:

  • Green smiley = value has not changed
  • Amber smiley = value has increased, but not more than 10%
  • Red = value has increased by more than 10%
  • Green minus symbol = value has decreased, but not more than 10%
  • Amber minus symbol = value has decreases by more than 10%

 

Explaining the results

Hovering over the symbol will show you the result of the calculation: duration / baseline duration. Notice that this is also done for summary tasks.

A positive result (more than 1) means that the current duration of activities needs more time than previously estimated within the project: we have lost time! If the concerning activity is on the critical path, the project will be delayed!

A negative result (less than 1) means that the current duration of activities needs less time than previously estimated within the project: we have gained some time!

Although a negative result is of course good news for the project, we consider this to be an estimate that is not so good, as it would have delayed preparations for successor tasks longer than needed, freed up resources later than possible, etcetera.

Meaning of the flag

The flag in the column Finish vs Baseline indicates if the task has moved, warning that you should also consider if the following tasks require a new start date. If you forget this, you might lose valuable time in your schedule or you are considering end dates for tasks that are not realistic anymore.

  • Green flag = task finishes as expected
  • Red flag = task finished sooner or later than expected

Use of the baseline in your organisation

How often is the baseline functionality in MS Project used within your organisation?

Share it in the comments below.

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Update tasks so you can predict your project’s end date

Update tasks so you can predict your project’s end date

There is only one thing that will never change in your project, and thats is the fact that everything will change constantly. We cannot count the number of times our students have brought up this fact as an argument for the statement that it has no use to try to plan a project. “We cannot predict the future”, is often said.

We totally agree, just like we cannot exactly predict on what minute we will be home when driving back home after a holiday. We do like the GPS in your car however, which takes all assumptions we CAN DO and transforms this into the most likely Estimated Time of Arrival (ETA). And when we hit a traffic jam, it will start adding minutes to this ETA, telling me that I have to change my strategy (average speed for example) to catch up. Because I know this well in advance, I might still have enough buffer to catch up.

Adding progress to your tasks

The GPS in your car does this updating automatically, but for your schedule you need to put in your actual progress. Adding progress to tasks is about reviewing the tasks that were supposed to be done in the past period and update your plan with what was actually done.

Adding progress in your schedule

How frequently to you add progress to the tasks in your schedule?
Share it in the comments below.

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Solving resource overallocation in MS Project

There are several ways to solve resource overallocation in MS Project (those resource has more work than its availability). Although many MS Project users are hesitant when it comes to using the leveling functionality to solve overallocation, it is possible to do this in a truly controlled manner.

With the option we discuss here, you have most control over how the tasks will be ordered.

Notice the tasks with the ‘red puppet’:

  • Hover on the red puppet for the task with the least priority (the least critical task)
  • Right-click > Reschedule to available date
  • Check to see that the task has now moved to the first location where the resource has availability
  • Note that this also induces leveling delay for the moved task

Be in control

The benefit of solving overallocation this way is that you are completely in control of what happens.

Solving resource overallocation in MS Project1

Another option

It is also possible to level a selection of tasks all at once:

  • Select the tasks you want to level
  • In tab Resource, click Level Selection

Solving resource overallocation in MS Project2

Only the tasks you have selected will be considered for delaying by MS Project. The other tasks remain untouched.

Are you confident?

How confident are in solving overallocations in MS Project with the technique we have just discussed?

Share it in the comments below.

 

 

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Preparations before resource loading

Preparations before resource loading

Before you start loading your schedule with resources, it is important that you know what MS Project will do for you from the moment that they are part of the equation. A good preparation before resource loading is crucial!

First things first

You first need to identify the tasks in your schedule with fixed work/duration/units and set these accordingly. MS Project calculates with the so-called ‘iron formula’, where the fields work, duration and assignment units calculate each other, based on which of the fields MS Project should not touch.

For instance, traveling with one ship from England to New York takes one week. If you travel with 7 ships (units), should the duration of the trip then be calculated to one day? No, exactly!

Preparations before resource loading1

It is advised to use baseline 10 before assigning the resources, so you can easily spot any changes that are caused by the resources’ availability.

Task types

Which task type do you use in your schedule and why?
1) Fixed duration
2) Fixed units
3) Fixed work

Share the number and reason in the comments below.

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Evaluating and optimizing your schedule

Evaluating and optimizing your schedule

You want to evaluate and optimize your schedule? When you evaluate the progress against the baseline you may have found that the new situation offers new challenges; for instance because you are warned by one or more Red Exclamation Marks in the first column of your schedule. This means that your updates have caused one of your milestones to pass its deadline, which means you need to take action to manage this delay back.

Evaluating and optimizing your schedule1

Learn from your estimates

Always compare the duration of your tasks with its baseline duration to see whether you can learn from your estimates. If you can find a pattern in types of tasks that keep delaying it is smart to take the average deviation and adjust future similar tasks accordingly. 

Your experience with evaluating

Do you ever adjust your schedule during your project based on the comparison between duration and baseline duration?

Leave it in the comments below

 

 

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Our top 5 tips for baselining

Our top 5 tips for baselining

Using the baseline could be a formal method to compare your progress to the original schedule. For this reason there are a couple of things you should consider. Here our top 5 tips for baselining:

 

  • Tip 1: When you have an approved scope/time change, rebaseline the current baseline (BL) (this will be the latest baseline) and save baseline 2 (BL 2), in case you want to compare multiple baselines later.
  • Tip 2: Do not delete or move tasks, but reduce remaining work to ‘0’ and/or create a new task on the new location.
  • Tip 3: Be careful with drag & drop and indent/outdent as summary lines will deviate from the baseline.
  • Tip 4: When you add tasks to the baseline, also rebaseline the tasks that are affected by the added task, such as successors or summary tasks.
  • Tip 5: The ‘To all summary tasks’ option (roll up baseline) will also change baseline summary tasks. This might give a wrong image of the starting situation and is like rebaselining all the summary tasks.

Share your secret

Do you have another tip we can add to this list? Share it in the comments below so we can help each other.

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How to determine durations correctly in MS Project?

How to determine durations correctly in MS Project?

Do you determine durations correctly in MS Project? Why are we not finishing all our projects on time? Do we actually calculate correctly from beginning on when setting up the tasks, durations and their estimates?

Save yourself and your whole project team time and money by giving your tasks the right duration. So how do you do that? Let’s start at the beginning:

From the moment you have all your tasks structured in your schedule, it is time to give these task the right duration. At this point, consider the number of working days (exclude weekends) between start and finish of the task. This means that if you work two hours per day on a task for five consecutive days starting Wednesday, the duration will be 5 days.

Adding durations to tasks in MS Project can be done in two ways:

  1. By typing the number of days into the Duration column
  2. Have Duration be calculated by MS Project by assigning resources and their availability to the task and estimating the hours of ‘work’.
  3. This is explained in our e-course ‘Resource Management‘, as many factors will then determine your duration.
    You will see that sometimes the duration has a question mark. This appears when the duration column has not been edited. The idea is that as long as this value is not put in by the user, it is an estimated value.

Duration of tasks

Durations of tasks and thus projects are determined by the amount of effort they take and the availability of resources that spreads this effort over the duration of the task. This means that whether you put in the duration in your schedule directly or have duration be calculated by MS Project, duration is ALWAYS effected by the total estimated amount of effort and how the resource is assigned to the task. After agreement on resources and on budget, and this budget is correctly reflected in the availability of resources in your schedule, the process of effort (‘work’ in MS Project) estimating becomes the most important factor to get reliable lead times.

One of the prerequisites for producing the best estimate is to have spent sufficient time analyzing and understanding the requirements and the proposed solution.

Managing project durations is often a challenge due to (the great number of) uncertainties. Planning without regard for these uncertainties would induce risk of not meeting the agreed plan date. Plan dates depend on information we know – the agreed triple constraint (scope, time and resources) as well as things we do not know – actual scope, actual effort, actual resource availability and risks (based on agreed changes). To include contingency time for 100% of all likely and unlikely events is not wanted. Therefore the level of risk you accept to take largely determines the estimates of the effort. At the next chapter we discuss how you should factor in the risk in your estimate.

Level of detail

The level of detail you choose determines the accuracy, and thus the quality of the estimates. The notion that detail is needed to make more accurate estimations is NOT correct. When planning tasks of an hour, the likelihood that you will exceed by 100% is much greater than planning tasks of for instance 40 hours. For planning with as accurate as possible estimations 16 – 40 hours per task is ideal.

On the other hand, the validity of the estimate largely depends on how much time in advance the estimate was made, regarding the simple fact that uncertainty increases when you look further into the future.

As a guideline: plan tasks of about 16-40 hours (can be spread over a longer duration) for the next 3 to 6 months. Every task after this period could have less detail as many things could still be unknown.

Estimating effort (work)

There are many factors that determine the estimates:

  • Experience
  • Avoiding risk of failure
  • Wishful thinking
  • Pressure from stakeholders to shorten the plan
  • Pressure to come up with a plan fast (not enough time to perform estimation)
  • Experience of colleagues
  • The complexity of the tasks
  • Are the deliverables clear?
  • Available knowledge
  • Available FTE and resources
  • Etc.

The best practice for coming to estimates is:

  • Select a group of 6-8 of the most knowledgeable people with regard to the topic for the session, for instance engineers, stakeholders, certain team members and if known the resource that will be doing this assignment. These experts do not need to be from the own project team. Since many times the actual resource is not yet known, the experts need to consider a generic resource (a role) – how many hours would the average person in this role (with this competence) need. Later the estimate can be reevaluated by the actual person doing the task.
  • Prepare the session as good as possible by knowing the deliverables and their requirements, having the necessary documents available, and have specifications and must-have results aligned with the sponsor.
  • In the session: Align the tasks (every person has the same understanding of what needs to be done) and have every person give their best estimate for the tasks.
  • Plot the 6-8 estimates in a graph like below. Less estimates means less combined expertise and will decrease the accuracy of the estimate.

How to determine durations correctly in MS Project?1

  • Discuss the estimations all participators made and learn from each other which assumptions were done making the estimates. Start with the persons giving the highest and lowest values (1 and 5 in above example). Make sure each participant knows why choices are made.
  • Reach consensus on:
  1. Best case (1,3,6)
  2. Most likely case (6,4,8)
  3. Worst case (2,7,5)
  • Repeat these steps for all tasks that are part of this estimation session.
  • The estimate is calculated like this:

Best case                      :           16 hours          x          1          =            16

Most likely case         :           65 hours          x          4          =          260

  Worst case                   :           120 hours        x          1          =          120 +

Total                                                                                               =          396 hours

Divide the total by 6.
396 hours / 6 = 66 hours

66 hours would be a realistic and reliable estimation for this task to use in the column ‘work’ when you create your schedule.

Note: Document the estimations and assumptions which are discussed with the responsible resources to create a reliable estimation database.

Challenges with estimations

What are your main challenges when estimating durations in your schedule?

Leave it in the comments below.

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