1 Tracking and variance

A simple explanation of variance is; The difference between the original agreed plan – called the baseline plan – and the actual results of doing the project.

A project will have variances in:

• Planned task time minus actual task time
• Planned cost minus actual cost
• Planned resource availability / effectiveness minus actual resource availability / effectiveness
• Planned quality vs. actual quality

In reality, variance is a little more complex that the simple explanation. Project plans need to be more flexible to allow for changing nature of expectations and circumstances. Developing a flexible plan can be formally stuctured and work very effectively. The most easily explained example is a flexible budget. The following video provides such an explanation. The same principle of flexibility also needs to apply to all the other project plans (time, resources, quality etc) to keep them viable and meaningful: