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This means that there are two versions of the schedule. One is a fixed baseline version that
is kept as a reference, and the other is an actual version of the schedule that is updated to
reflect what actually happened over the course of the project. The baseline schedule never
changes over the course of the project. Every time a task is delayed or changed, the actual
schedule should be updated to reflect that. Each schedule change should be stored as a
separate revision, which shows a snapshot of what the schedule looked like at any time in
its history.

When the due date for the actual schedule is later than that of the baseline, the project has
slipped. However, the schedule slip does not tell the whole story. A schedule might slip
because the team is waiting for a single person to complete a delayed task. It might also
slip because there is a general tendency to underestimate the effort required to perform all
tasks. It’s important for the project manager to track down the source of each slip in order
to help improve the team’s estimates in the future, and to work with senior management
to determine whether action needs to be taken.
The most common way to understand the nature of the schedule slip is to calculate the
variance. This is a calculation that dates back to the early 1900s, when it was used by facto-
ries to track the difference between their budgeted costs and their actual costs. Variance is
now the core of a project management system called earned value management, which
tracks the project by considering effort “earned” against a budget only after it has actually
been performed. For software projects, the variance is a measurement in person-hours (or
person-days, person-years, etc.) that shows the difference between the effort planned to
date on the baseline and the effort completed on the actual schedule.

The budgeted cost for work scheduled (BCWS) is the estimated effort of the actual tasks that
appear on the schedule to date. The actual cost of work performed (ACWP) is the effort spent
on the tasks in the schedule that have actually been completed by the development team
members. The data required to calculate this information can be gathered by comparing
the effort represented in the baseline schedule (to find the budgeted cost) with the effort
in the actual schedule. (Many project management software packages will calculate these
numbers automatically.) The variance is the difference between these two numbers
(BCWS – ACWP). (BCWS and ACWP are standard acronyms used in most earned value

calculations.) If the variance is positive, then the project cost fewer person-hours than
were budgeted; if it is negative, then the project overran the budget.
The variance is useful in helping a project manager determine whether a schedule slip is
due to an isolated incident or a systematic problem. If there is a large schedule slip but the
variance is small (if, for example, it is much smaller than the length of the delay), then the
project manager should look for one or two tasks that were delayed. On the other hand, if
the variance is large, there may be a problem with the way the team estimated the tasks.
The project manager can spend additional time with the team to work on the estimates—
for example, extra Wideband Delphi estimation sessions can be performed to decompose
the tasks that are more susceptible to delays. This can be used both for future projects and
for tasks that have not yet been performed in the current project.

64 CHAPTER FOUR