What is Schedule Variance and how to calculate it?

In the project management realm, a clearly outlined schedule is a prerequisite to success and timebound completion of projects. However, deviations from the planned schedules are not so avoidable in the fast dynamics of project implementation. Schedule variance (SV) is one of the key performance indicators (KPIs) that quantify the scope of the deviation of the real project progress from the planned schedule. In this article we deep dive into the term called schedule variance, examine its role, and present the ways for its estimation.

Understanding Schedule Variance

Schedule Variance (SV) refers to the difference between the planned schedule and the actual outcome recorded at a particular point in time during the project performance. It offers measurements of where the project stands for the schedule, that is, whether the project is ahead of the schedule (positive SV), behind the schedule (negative SV), or precisely in line with the schedule (SV equals zero). Time variances are usually presented by the number of time units (e.g., days, weeks, or months) as the proportion of planned duration.

Significance of Schedule Variance

Schedule variance has a couple of major roles in project management.

1. Performance Evaluation

SV does the following for the project managers and the stakeholders, it provides them with a quantitative measure that allows them to know whether the project as scheduled or not.

2. Early Detection of Issues

By calculating SV at all planning intervals throughout the project duration, project managers can identify deviations from the planned schedule at earlier stages, thus enabling them to take corrective actions in a timely manner and neutralize potential delays.

3. Decision-Making

The SV helps the utilization of data-based decision-making by making sense of the project progress and trend on performance. It makes project managers to set tasks on priority, do resource allocation properly and adjust project plan for better results.

4. Communication and Stakeholder Management

SV acts as a means of communication for project managers to keep stakeholders updated with the performance of the project and if there is any deviation from the planned schedule.

Calculating Schedule Variance

Different types of schedule variances may be computed by employing different approaches, depending on the desired level of detail and accuracy. The widely used technique is the tracer study in which scientists inject a unique substance with a reduced half-life, later, they measure the amount of the remaining substance for finding the half-life of a process or substance under investigation.

1. Earned Value Management (EVM):

This schedule variance is identified by doing a comparison of the planned value (PV) of the work estimated to be completed in a specific time with the earned value (EV) of the work really completed.

While the EV model requires providing the numerator, it requires for the product of N with Pn to be obtained.

SV = EV−PV, Where

• EV(Earned Value) stands for sum of the product of the costs planned for completion of the work and the efficiency of the work at a particular instant of time.
• While the PV (Planned value) specifies the amounts of work that are required to accomplish for the given time in advance.

2. Baseline vs. Actual Schedule Comparison:

Another method is when you align the baseline plan (initial planned plan) with the actual schedule, and figure out the difference in schedule. It does not a precise evaluation; even though it presents a simple criterion.

Scheduled Variance Example Calculation

We will apply our example case to a project that is 10-week scheduled (PV = 10) and is 8-weeks accomplishment already achieved (EV = 8)Using the EVM formula

SV = EV – PV = 8-10 = -2 Weeks

Here shows the schedule variance as -2 weeks, where the planned schedule lacks two weeks compared to the actual schedule.