PM Practice: The Right Way to Track Actuals

Most project managers I know track actuals at a task (e.g., 25% complete) or duration (e.g., 4 days spent, 3 days left) level. Effort (or work) is generally left to be managed by their scheduling tool. The method you choose for tracking actuals affects the ability of your schedule to predict final time, cost, or scope. The problems come when PMs use task-level tracking (low predictive power) in order to manage a project where high predictive power is required (i.e., project milestones are 'set in stone').

Effort is the real currency of most all projects. It measures, in hours, the heads-down work performed by individual members of the project team. It is a key determinant for the duration and cost of most tasks. Project managers that track actuals at an effort level are able to sort out what is causing delays or cost overruns because their project data is more granular. When I track actuals in my projects, I can make smaller, more targeted, corrections in concert with my project team. My projects still slip (after all, we only manage risk, we don't control it), but they do so less often, and usually less dramatically (and therefore more correctable).
Tracking actuals at the effort level is just as easy as other methods. I follow these steps:

1. Each week, my team reports ATD (actuals-to-date), in work hours, for any task that was ongoing at some point during the week. I build my schedules such that each team member will typically work on 1 to 3 tasks per week.
2. For each of these tasks, my team also provides and ETC (estimate-to-complete). Obviously tasks that they completed will have an ETC of 0 hours. Steps 1 and 2 take each team member about 5 minutes a week.
3. I set up a tracking view in my scheduling tool (whatever my client needs me to use) that allows me to apply ATD and ETC to individual tasks every week. There are tons of tools that will automate this process, but even if I do it manually, we are talking 10-15 minutes every Monday morning for a team of 30 people.
4. I save my project plan, updated with last week's actuals, and begin my weekly upkeep (a tidy schedule is a defensible schedule I always say!).

I have taught several hundred project managers the nuts and bolts of this process over the years and those still in the job today couldn't imagine not tracking their actuals another way. Anyone can learn how to do this and the impact on project manager performance is a blast to watch. New project managers gain confidence because they develop a better understanding of their projects. Experienced, capable PMs get a real boost from this method because it helps them validate their intuition about adjustments they may need to make.

Agile adjustment: This practice works with Agile, though you may choose to shorten the interval from a weekly timesheet to a daily verbal report of ATD and ETC. Properly measured, tracking effort can help Agile teams compensate for deficiencies in the organizational implementation of the development method ... but that discussion is for another time.