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6 - PROJECT TIME MANAGEMENT

Depending on the assumed distribution of values within the range of the three estimates the expected duration,
tE, can be calculated using a formula. Two commonly used formulas are triangular and beta distributions. The
formulas are:
• triangular distribution. tE = (tO + tM + tP) / 3

• Beta distribution (from the traditional PERT technique). tE = (tO + 4tM + tP) / 6
Duration estimates based on three points with an assumed distribution provide an expected duration and clarify
the range of uncertainty around the expected duration.

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6.5.2.5 Group decision-Making techniques

Team-based approaches, such as brainstorming, the Delphi or nominal group techniques, are useful for engaging
team members to improve estimate accuracy and commitment to the emerging estimates. By involving a structured
group of people who are close to the technical execution of work in the estimation process, additional information
is gained and more accurate estimates obtained. Additionally, when people are involved in the estimation process,
their commitment towards meeting the resulting estimates increases.

6.5.2.6 reserve Analysis

Duration estimates may include contingency reserves, sometimes referred to as time reserves or buffers,
into the project schedule to account for schedule uncertainty. Contingency reserves are the estimated duration
within the schedule baseline, which is allocated for identified risks that are accepted and for which contingent or
mitigation responses are developed. Contingency reserves are associated with the “known-unknowns,” which may
be estimated to account for this unknown amount of rework. The contingency reserve may be a percentage of the
estimated activity duration, a fixed number of work periods, or may be developed by using quantitative analysis
methods such as Monte Carlo simulation (Section 11.4.2.2). Contingency reserves may be separated from the
individual activities and aggregated into buffers as shown in Figure 6-19.

As more precise information about the project becomes available, the contingency reserve may be used,
reduced, or eliminated. Contingency should be clearly identified in schedule documentation.

Estimates may also be produced for the amount of management reserve of time for the project. Management
reserves are a specified amount of the project duration withheld for management control purposes and are
reserved for unforeseen work that is within scope of the project. Management reserves are intended to address the
“unknown-unknowns” that can affect a project. Management reserve is not included in the schedule baseline, but
it is part of the overall project duration requirements. Depending on contract terms, use of management reserves
may require a change to the schedule baseline.

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