Construction project managers need to regularly keep track of how their project is progressing. S curve is probably one of the most popular tools used for this kind of tracking.

Based on Earned Value Project Management method, actual S curve indicates the ‘cumulative value of actual work done’ against the value of planned work.

This ‘value of actual work done’ is often calculated either in terms of % progress OR $ value for different activities.

For example –

Planned Task:

Excavation works
Scope – 100 cubic m
Budget – $5,000
Duration – 6 days
Efforts – 18 mandays
Machine & Equipment Cost – $1,500

Progress till date is captured as –

Actual work done:           40 cubic m
Actual time spent:           2 days
Actual costs incurred:     $2500

So what is the value of actual work done?

Basically, the actual work done is not measured by time spent or the dollars spent. But rather the actual excavation done. In this case, it is 40 cubic m.

OR in terms of % completion – 40% work is done (40 / 100)

OR in terms of $ value – $2,000 worth work is done (40% X 5000)

All of these are valid interpretations of how much work has been done.

Earned value of overall project

To sum up the value of actual work done for all different project activities, one option would be to simply add all the actual work values.

But normally that doesn’t work. As different activities are measured with different units – cub. m, sq.m, Kg, Tons, meter etc. You can’t simply add values measured in different units – it would be like comparing apples to oranges.

You can simply sum up the dollar values of work done on all activities.

OR

So instead, you can take the % progress value and take a weighted average of all those values.

Weighted average is used instead of a simple average (mean value), because each activity has a different contribution to the overall project progress.

Earned value of a project is calculated as a weighted average using the following equation –

Where,      EVi = Earned value of task i
                Wi = weightage of task i

Task Weightage

In the earned value equation, weightage of a task is plugged in to reflect the importance (or weight) of a task when it comes to overall project progress.

For example – a task planned for 40 days, involving 10 workers on site is definitely more important than another task which is done by a single man in 2 days.

But saying one task is more important than the other is very notional.

How do you further quantify how much more important that task is?

There are several parameters that we can use to quantify the importance or weightage of task, such as – task duration, efforts (mandays), total cost, billing value etc.

So which of these parameters is most accurate representation of importance or value of a task?

Identifying the correct task weightage

Duration, efforts, material costs, labor costs etc. are all indicative of work to be done in a task. But sometimes it is difficult to choose only one of them to represent the task weightage.

For example, consider two tasks –

Task A:

Excavation for Area A
Scope – 50 cubic m
Budget – $2,500
Duration – 6 days
Efforts – 12 mandays
Machine & Equipment Cost – $1,000
Invoice to client – $2,750

Task B:

Plumbing works
Scope – 100 m of 1” pipe
Budget – $800
Duration – 6 days
Efforts – 6 mandays
Machine & Equipment Cost – N/A
Invoice to client – $880

How do we choose the correct factor to represent the weight of a task?

Duration

Note that if we select duration as the weight factor, both tasks have the same duration of 6 days. That will mean that both tasks are equally important in this project.

Now that may be true in some cases where project delivery is of the highest priority, regardless of the costs involved.

But normally, both schedule and costs are important to a construction contractor. If we consider the duration as weightage, importance of task costs is not captured.

Costs

So what if we directly use the project costs as task weights?

This is an approach that is commonly used by construction contractors. Costs are fairly accurate in capturing the ‘weight’ of a task and signaling its importance – proportionate to the costs.

So in the present example, Task A is roughly 3 times heavier than Task B.

But, costs of construction activities involve – labor costs, services, material and equipment costs.

Some construction project managers look to further simplify things by focusing on one type of costs depending on the nature of the project.

Efforts (labor costs)

Labor costs in terms of mandays can be directly used for projects where only the construction work is in the contractor’s scope of work and material procurement is done by project owner.

In this case the labor costs or mandays efforts of a task directly reflect the total cost on contractor’s side.

Same is applicable in case of engineering design, consulting projects – involving effort based professional services.

Material Costs

Generally, material costs and costs of equipment/machinery also feature in contractor’s scope of work. But they are almost always clubbed together with labor costs.

Hence it is rarely advisable to use material costs or machinery costs directly as task weightage. Rather the overall costs can be used, by adding up material costs to labor costs.

Billing (invoice) value

A contractor calculates the billing value (or invoice value) of each task by considering some margin on the overall costs.

Invoice value reflects all the efforts, material costs, machinery costs, labor costs etc. clubbed together in a single number.

The invoice value represents the exact importance of a task to the contractor.

Normally, this is the best candidate to be used as task weightage for earned value analysis.

Summary

Different project management methods like earned value management and S curve reports, often need to use task weightage for calculation of different tasks to overall project progress.

Some candidates for these tasks are – duration, efforts, costs, invoice value etc.

Depending on the nature of the project and availability of data, proper weightage parameter can be selected.

Usually, it is a good practice to use invoice value for task weights – since it is inclusive of all the important parameters for a contractor or project manager.