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Project controlling methods

The mental model behind the figures: planned/actual comparison, earned value analysis, the traffic-light method, milestone trend analysis and contribution margin – and how teamspace implements them.

Behind the Controlling reports lie methods – proven ways of assessing a project. This article explains the most important ones as a mental model and shows how teamspace implements them. It’s about the why behind the figures; the actual operation of the reports is described in Project reports.

Good project controlling answers three questions at its core:

  • Is my project running to plan?
  • Which projects are falling behind?
  • Which projects are over budget?

Progress and status

The first port of call: progress and status. You state to what percentage a task is complete; for higher-level subprojects and the main project, the progress is calculated automatically. The status (in planning, in progress, done …) is freely definable and can be combined into workflows. Together they give a first picture of how the project stands.

Planned/actual comparison

The planned/actual comparison is the fundamental method: you compare the current value of a project parameter (time used, costs incurred) with the respective planned value. This way it stands out immediately when something runs out of bounds. teamspace provides the comparison in real time for, among others, start/end time, duration, labour costs, external costs, revenue, total costs and project times.

Contribution margin

So that you know how profitable a project is running, teamspace calculates the contribution margin automatically and always up to date – it takes into account all of the project’s revenue and expenses. The basis of the calculation is the employees’ internal cost rate (HR portal, per period). You analyse the contribution margin in the Project analysis, Employee analysis and Customer analysis.

Earned value analysis

The earned value analysis is simple but meaningful: from a few pieces of data you get reliable forecasts of whether the project stays within its time and cost frame. It consists of three basic elements:

  • Planned costs – how much budget should be used up by the current stage?
  • Actual costs – which costs have been incurred by the current stage?
  • Value of work completed (earned value) – what value has been completed by the current stage?

From this, teamspace calculates two variances and two efficiency metrics:

  • Schedule variance – if the planned costs are higher than the value of work completed, the project is behind schedule.
  • Cost variance – if the actual costs are greater than the value of work completed, the project is over budget.
  • Schedule efficiency – by what percentage longer/shorter than planned is the project likely to take?
  • Cost efficiency – by what percentage more/less than planned is it likely to cost?

The traffic-light method

The traffic-light method pursues a similar goal to the planned/actual comparison, but visually: for important metrics you define which variance is green, amber or red. This way you recognise at a glance where action is needed. In the service desk, the same principle reappears in the SLA traffic light of the tickets.

Milestone trend analysis

In the milestone trend analysis, the likely time of reaching important project goals is re-estimated with every project report. Over time, a trend line emerges: it shows whether milestones are slipping and thereby endangering the project – the project is running better or worse than expected.

Automatic warnings

If a project is not running as planned, teamspace automatically sends notices or warnings – by email if desired. This way you can step in immediately when needed, without constantly checking manually. Which projects are currently triggering warnings is shown by the Project status analysis.