M & C

Variance analysis

Variance analysis reports collect and assemble information on project performance variances. Common topics are schedule, cost, and quality variances. Information on a variance analysis includes:

  • Schedule variance
    • Planned results
    • Actual results
    • Variance
    • Root cause
    • Planned response
  • Cost variance
    • Planned results
    • Actual results
    • Variance
    • Root cause
    • Planned response
  • Quality variance
    • Planned results
    • Actual results
    • Variance
    • Root cause
  • Planned response

Variance analysis is an example of a data analysis technique in the PMBOK® Guide – Sixth Edition. The information can be provided as a standalone report, as part of the project status report, or as backup to an earned value status report. It is identified as a technique in these processes:

  • 5 Monitor and Control Project Work
  • 7 Close Project or Phase
  • 6 Control Scope
  • 6 Control Schedule
  • 4 Control Costs

Tailoring Tips

Consider the following tips to help tailor the variance analysis to meet your needs:

  • Scope variance can be included but is generally indicated by a schedule variance, as either more or less scope will have been accomplished over time.
  • The variance analysis can be done at an activity, resource, work package, control account, or project level depending on your needs.
  • You can add a check box to indicate if the information needs to be escalated to the sponsor, pro- gram manager, or other appropriate individuals.
  • You may want to add a field that indicates the implications of continued This can include a forecast based on a trend analysis or based on identified responses.
  • In addition to tailoring the content of the variance analysis, you can tailor the presentation. Many PMOs have reporting software that transforms the data into dashboards, heat reports, stop light charts, or other representations.

 

Alignment

The variance analysis should be aligned and consistent with the following documents:

  • Team member status reports
  • Project status report
  • Project schedule
  • Cost estimates
  • Project budget
  • Issue log
  • Earned value status report
  • Contractor status report
Document elements Description 
Schedule variance Planned result Describe the work planned to be accomplished.
  Actual result Describe the work actually accomplished.
  Variance Describe the variance.
  Root cause Identify the root cause of the variance.
  Planned response Document the planned corrective or preventive action.
Cost variance Planned result Record the planned costs for the work planned to be accomplished.
  Actual result Record the actual costs expended.
  Variance Calculate the variance.
  Root cause Identify the root cause of the variance.
  Planned response Document the planned corrective or preventive action.
Quality variance Planned result Describe the planned performance or quality measurements.
  Actual result Describe the actual performance or quality measurements.
  Variance Describe the variance.
  Root cause Identify the root cause of the variance.
  Planned response Document the planned corrective action.