Running forecasts on your project is an extremely powerful way to get critical insight into your project’s current status and projected final results. Forecasts, however, do a lot more than that; especially if you run forecasts on regular intervals.
Regularly forecasting is a key strategy for the project manager in any construction project. There are several reasons for this. First of all, entering percent complete on the tasks in your project is prone to some subjectivity and error. Regardless of how you go about determining percent complete – whether it’s pre-defined earning rules, best-guess approach or team-based assessment – it’s practically impossible to know exactly how far along any task is. There are a number of techniques for mitigating the errors in applying percent complete – and we’ll talk about more of these in other articles – but one of these techniques lies is the power of executing forecasts on a regular basis.
In 4castplus, forecasts are easy to do and provide a quick, high-value snapshot of where things are at right now in your project. What you may not have realized is that 4castplus also keeps a copy of all the information in your project as it was in that forecast period. So taking that snapshot means that all that information is preserved for historical reporting. If you run forecasts on, for example, a weekly basis, 4castplus will enable you run reports on the history of how your project progressed over time, on a week-by-week basis. Have a look at the screenshot below (click on it for a full view). It shows a summary-detail report that’s interactive for the user to click-through the forecast periods in a project. The detail report below shows all the costs, EVM metrics, change orders, etc. that were in place during that time-slice.
How does this reduce forecasting errors? First of all, the project manager is empowered with good information on the rate of progress over time in the project. This reduces the guesswork involved with determining the next increment of percent complete on a task. Wild swings in percent complete and variance are markers to look out for in most areas of a project. The key here, is to watch for trends that may or may not be realistic. If there is a significant jump in percent complete from one forecast period to the next for example, there should be a good reason why.
Secondly, there is a tendency for people (this includes project managers) to be overly optimistic and eager to report results that represent an idealistic picture of a project’s progress. When mapped out over time, these numbers will show a pattern that may or may not be favourable to that type of behaviour.
Trending – Performance is Key
Watching a project’s trending patterns over time is an incredibly valuable project analysis tool. Trending provides powerful intelligence into the performance of the various areas of a project. Performance is key. If crews, contractors are under-performing for whatever reason, it’s obviously important to know that. But it’s taken to a whole new level when you can look at performance trends. For example, if an area of your project was under-performing a month ago, you’ll want to know if that performance has improved after you applied certain corrective action. How would you know that if you couldn’t keep a detailed history of all those performance metrics? Have a look at the chart below (click on it for a full view) for a quick glimpse of a project’s percent complete and variance trend lines to date. This is not a happy-looking project. Some sudden spikes in percent complete were followed by periods of flat progress. Then, as the project is nearing completion, a long close-out shows that early assessments were optimistic. Seeing this type of information should alert the project team that more rigorous understanding of the project state are needed. What do you think?
Many project managers miss out on the value of forecasting and, equally importantly, forecasting regularly. There is perhaps a perception that it’s a theoretical nice-to-have that doesn’t provide a huge amount of value. Either that, or perhaps it’s not well understood. Whichever the reason, with 4castplus, we’ve put a tremendous amount of effort in making the process of regular forecasting as easy and painless as possible – and we’ve provided many key reports that are available in a few clicks, which deliver quick and meaningful project information.