There are five types of project status reports:
Current period reports. These reports cover only the most recently completed period. They report progress on those activities that were open or scheduled for work during the period. Reports might highlight activities completed and variance between scheduled and actual completion dates. If any activities did not progress according to plan, the report should include
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a discussion of the reasons for the variance and the appropriate corrective measures that will be implemented to correct the schedule slippage.
Cumulative reports. These reports contain the history of the project from the beginning to the end of the current report period. They are more informative than the current period reports because they show trends in project progress. For example, a schedule variance might be tracked over several successive periods to show improvement. Reports can be at the activity or project level.
Exception reports. Exception reports report variances from plan. These reports are typically designed for senior management to read and interpret quickly. Reports that are produced for senior management merit special consideration. Senior managers do not have a lot of time to read reports that tell them that everything is on schedule and there are no problems serious enough to warrant their attention. In such cases, a one-page, highlevel summary report that says everything is okay is usually sufficient. It might also be appropriate to include a more detailed report as an attachment for those who might wish to read more detail. The same might be true of exception reports. That is, the one-page exception report tells senior managers about variances from plan that will be of interest to them, while an attached report provides more details for the interested reader.
Stoplight reports. Stoplight reports are a variation that can be used on any of the previous report types. We believe in parsimony in all reporting. Here is a technique you might want to try. When the project is on schedule and everything seems to be moving as planned, put a green sticker on the top right of the first page of the project status report. This sticker will signal to senior managers that everything is progressing according to plan, and they need not even read the attached report. When the project has encountered a problem—schedule slippage, for example—you might put a yellow sticker on the top right of the first page of the project status report. That is a signal to upper management that the project is not moving along as scheduled but that you have a get-well plan in place. A summary of the problem and the get-well plan may appear on the first page, but they can also refer to the details in the attached report. Those details describe the problem, the corrective steps that have been put in place, and some estimate of when the situation will be rectified. Red stickers placed on the top right of the first page signal that a project is out of control. Red reports are to be avoided at all costs because they mean that the project has encountered a problem, and you don’t have a get-well plan or even a recommendation for upper management. Senior managers will obviously read these reports because they signal a major problem with the project. On a more positive note, the red condition may be beyond your control. For example,
there is a major power grid failure on the East Coast and a number of companies have lost their computing systems. Your hot site is overburdened with companies looking for computing power. Your company is one of them, and the loss of computing power has put your project seriously behind in final system testing. There is little you can do to avoid such acts of nature.
Variance reports. Variance reports do exactly what their name suggests— they report differences between what was planned and what actually happened. The report has three columns:
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■ The planned number
■ The actual number
■ The difference, or variance, between the two A variance report can be in one of two formats:
■ The first is numeric and displays a number of rows with each row giving the actual, planned, and variance calculation for those variables in which such numbers are needed. Typical variables that are tracked in a variance report are schedule and cost. For example, the rows might correspond to the activities open for work during the report period and the columns might be the planned cost to date, the actual cost to date, and the difference between the two. The impact of departures from plan is signified by larger values of this difference (the variance).
■ The second format is a graphical representation of the numeric data. It might be formatted so that the plan data is shown for each report period of the project and is denoted with a curve of one color; the actual data is shown for each report period of the project and is denoted by a curve of a different color. The variance need not be graphed at all because it is merely the difference between the two curves at some point in time. One advantage of the graphic version of the variance report is that it can show the variance trend over the report periods of the project, while the numeric report generally shows data only for the current report period.
Typical variance reports are snapshots in time (the current period) of the status of an entity being tracked. Most variance reports do not include data points that report how the project reached that status. Project variance reports can be used to report project as well as activity variances. For the sake of the managers who will have to read these reports, we recommend that one report format be used regardless of the variable being tracked. Top management will quickly become comfortable with a reporting format that is consistent across all projects or activities within a project. It will make life a bit easier for the project manager, too.
There are five reasons why you would want to measure duration and cost variances:
■■ Catch deviations from the curve early. The cumulative actual cost or actual duration can be plotted against the planned cumulative cost or cumulative duration. As these two curves begin to display a variance from one another, the project manager will want to put corrective measures in place to bring the two curves together. This reestablishes the agreement between the planned and actual performance. This topic is treated in detail later in the chapter in the section Cost Schedule Control.
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■ Dampen oscillation. Planned versus actual performance should display a similar pattern over time. Wild fluctuations between the two are symptomatic of a project that is not under control. Such a project will get behind schedule or overspent in one period, be corrected in the next, and go out of control in the next report period. Variance reports can give an early warning that such conditions are likely and give the project manager an opportunity to correct the anomaly before it gets serious. Smaller oscillations are easier to correct than larger oscillations.
■■ Allow early corrective action. As just suggested, the project manager would prefer to be alerted to a schedule or cost problem early in the development of the problem rather than later. Early problem detection may offer more opportunities for corrective action than later detection.
■■ Determine weekly schedule variance. In our experience, we found that progress on activities open for work should be reported on a weekly basis. This is a good compromise on report frequency and gives the project manager the best opportunity for corrective action plans before the situation escalates to a point where it will be difficult to recover any schedule slippages.
■ Determine weekly effort (person hours/day) variance. The difference between the planned effort and actual effort has a direct impact on both planned cumulative cost and schedule. If the effort is less than planned, it may suggest a potential schedule slippage if the person is not able to increase his or her effort on the activity in the following week. Alternatively, if the weekly effort exceeded the plan and the progress was not proportionately the same, a cost overrun situation may be developing.
Early detection of out-of-control situations is important. The longer we have to wait to discover a problem, the longer it will take for our solution to bring the project back to a stable condition.
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