Project Reporting: Reporting is progress versus plan.
“Oh, no. it’s monthly report time again.”
Does your project team often have this thought? If so, read on to see how you can make reporting more interesting and meaningful for everyone.
Instead of onerous, mandatory drudgery, we encourage project managers to consider reporting as a chance to succinctly communicate progress and effectively manage expectations.
Now, for many organizations, project reporting includes several parameters, including the status of quality and safety. But let’s face it – for many of your stakeholders, what matters most is progress on cost and schedule versus plan. So, here we will limit our discussion to Earned Value for cost and schedule.
Given these two reporting objectives, the project report should focus as much on forecasting (i.e., what is planned) as results (what happened).
Furthermore, credible results and forecasting rely on more than just educated guessing. Earned Value is one reporting approach that can add credibility to both results and forecasting because it relies on measurement against a pre-established baseline called Planned Value.
There are numerous ways project managers have used over the years to estimate and communicate progress, but the Earned Value method provides accurate comparisons between the work scheduled and work performed, as well as the budgeted cost of work versus the actual cost of work.
It does take some discipline to learn new terminology and adopt a standard set of metrics or parameters, but the beauty of Earned Value is that, once implemented, it can succinctly communicate progress while effectively managing expectations for project cost and schedule. As an overview, we’ve listed the four key parameters of the Earned Value method in the table to the right.
These may seem intuitive, but if you look carefully at the definition, you see words such as “budgeted” and “actual”, which imply measurement (i.e., numbers) rather than guesswork.
In order to communicate process succinctly, most Earned Value reports show comparisons in graphs that plot cost or products against time. This usually results in a visual display shaped like an “S”. These “S” curves give a dramatic display of project growth or shrinkage over time, and they taper toward the end. As one of our clients loves to say, “They are “S” curves for a reason. Ignore them at your peril.”
The relative shape of the curves gives an indication of the trend, which, in turn, helps the project manager manage the expectations of the reader. Pictured below is an example of how some projects report cost.
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