Schedule Variance in Project Management: How to Calculate It

Schedule variance in project management helps businesses keep their projects on track.

This makes schedule variance one of the most important project management metrics.

In this article, we’ll discuss how to calculate your schedule variance, some benefits of using this metric, and strategies for keeping your projects on schedule.

Schedule variance is a metric that depicts the difference between your scheduled project progress and actual progress made. It’s usually depicted by taking into consideration your original budget, meaning that the result is presented in cost terms; 0 would be right on schedule, while -$X signifies delays, and +$X means you’re ahead of time.

Here’s the basic schedule variance formula:

You’ll also frequently come across the terms earned value and planned value to describe the same concepts. How do you calculate these two metrics? We’ll explain with a practical example.

First, you need to have your original budget. Let’s say it amounts to $10,000.

If your team has completed 40% of their work, this would amount to $4,000.

If the planned amount of work was 50%, this would amount to $5,000.

Putting all of these numbers together, you get: EV( $4,000) – PV ($5,000) = CV (-$1,000)

Negative schedule variance (like the one above), means you’re behind schedule. Neutral variance means you’re exactly on schedule, while positive variance means you’re ahead of schedule.

Instead of tracking your milestones and project deadlines manually, you can use project management software like Productive to manage your project lifecycle in real time. Head over to our section on calculating schedule performance with Productive to learn more.

 To get your schedule variance percentage, use the following formula:

In the example used above, the percentage would amount to -20%, meaning that the project is 20% behind schedule.

We can identify two types of schedule variance, depending on the time period you’re observing:

Both of these variations can be useful for different insights into effective project management; cumulative variance helps optimize processes for future projects, while point-by-point variance is best for finding potential issues and implementing corrective measures.

The three factors of project success include budgeting, time, and project scope. budgeting ensures that the project is completed within its allocated financial resources; time that it’s completed within the set deadlines; and scope that the deliverables and requirements are met.

Schedule variance monitors the second of these crucial components by providing managers with insights into project progress over the course of its completion. This helps managers identify issues before they put the project at risk and correct its course, usually by reallocating their project team or discussing their project plan with the client.

Understanding and tracking this metric also supports better outcomes for future projects; it helps project managers plan and estimate their projects more accurately. You can improve workflow efficiency, client satisfaction, and overall agency project management.

Now that you know how to run schedule variance calculations and why it’s important, here are three tips for keeping your project on track and mitigating project delays:

Your project delivery success is largely dependent on the planning phase. The two main questions are: Are you estimating the time it will take to finish certain tasks accurately? And how are you organizing your projects, tasks, deadlines, and assignees?

Having a clear overview of your project can help you identify its critical path — the sequence of tasks that directly affect the project finish date — so you can appropriately prioritize your resources.

Using project dashboards such as Gantt or Workload charts can help you break up this information to ensure the plan remains realistic and achievable.

Another essential element of planning is implementing a billable hours tracker that makes time tracking as painless as possible for employees. Developing a company culture where time tracking isn’t seen as a burden or micromanagement is important for getting reliable data.

Finally, the project team should have clear and visible access to your project goals to promote accountability and transparency.

Efficient resource allocation ensures that your employees and company resources are accounted for. This includes understanding your employees’ particular skillsets, their availability, and their cost rates.

A project manager needs to be able to schedule the right type of resource to the right type of task, so that they’re able to complete it within time and without conflict with other projects.

Scheduling your resources within a resource capacity plan that depicts availability and utilization is a great way to balance team workloads.

Additionally, capacity planning software that can deliver employee utilization metrics (and predict it ahead of time) can play a significant role in controlling project costs and maintaining the company’s financial health.

Employee utilization monitors billable vs total hours tracked to help you manage your project team’s efficiency. Very low utilization rates can signal issues with the project, such as miscommunication or lack of organization. However, you should also watch out for very high utilization rates (over 90%), as it can mean that your staff is getting burnt out.

Even when you’re calculating schedule variance, cost variance is necessary to complement your analysis. By analyzing the difference between the earned value and the actual cost of a project budget during a particular period, managers can assess whether a project is on, under, or over budget.

SV reveals whether the project is ahead or behind schedule, but it doesn’t account for the financial impact. Regular CV analysis also helps in making informed decisions about resource allocation and task prioritization, ensuring that financial constraints do not lead to schedule delays.

By combining these variance analysis metrics, managers can get more comprehensive insights into actual project performance.

There are various ways to manage your project performance with Productive. You can build and manage your budgets, monitor your expenses and overhead, track billable vs non billable time, allocate resources, and more.

For Time Tracking, entries can be created by tracking time directly from tasks (with an integrated timer) or by inputting them manually at any time. There’s a desktop timer widget that you can start from your navigation bar to simplify the process, and the Google Calendar integration allows events to be turned into time entries.

Project managers can easily approve or request additional information on entries, in bulk or individually. The Company time overview provides a digital timesheet that you can use to monitor progress across your project teams. By clicking on any individual entry, you can check time entries associated with a particular resource on a particular day.

You can also get a schedule performance indicator on each individual tasks by estimating and tracking your time on tasks.

With time to complete and worked time, you can get information on your progress with a glance. The most interesting metric here is variance at completion, which shows the difference between the initial estimate and the estimate at completion (or full time worked on tasks).

A positive schedule variance or one that amounts to 0 is good, while a negative variance means your estimate was off.

Another way to track your schedule in tandem with your budgeting is Productive’s Budgeting Tab. Your budget burn will update according to billable hours tracked. So, in the example below, we see that five billable hours tracked (on a billable rate of $100/h) result in $500 dollars of the budget spent.

By switching to the Profitability tab, you can also monitor your revenue and profit margin. This ensures that you can deliver a project that is successful not only for your clients but also for your business.

And, if you turn on the forecast chart, this overview will tell you your future performance according to your scheduled employees. This provides you with a way to control project performance based on timely, reliable data.

With Productive’s Reporting, you can also put together custom analytics to support project planning success. Some useful reports include:

Productive also provides no-code automations for streamlined workflows, custom user permissions, billing, sales CRM, and a range of integrations for a more seamless tech stack.

Book a demo with Productive to find out how to support your agency operations today.

Schedule variance (SV) measures the difference between the work planned and the work actually completed by a certain point in time, indicating whether a project is ahead of or behind schedule. Cost variance (CV) evaluates the difference between the budgeted cost of work performed and the actual cost incurred, showing if the project is over or under budget. Both metrics are depicted in monetary terms, but they provide different insights into actual project progress.

Cost variance (CV) tells you the difference between what you’ve actually spent and what you planned to spend on a project, expressed in monetary terms. A positive CV means you’re under budget, while a negative CV means you’re over budget. The cost performance index (CPI), on the other hand, is a ratio that measures how efficiently you’re using your budget. A CPI greater than 1.0 means you’re spending efficiently, while a CPI less than 1.0 indicates inefficiency.

Common causes of negative Schedule variance include unrealistic scheduling, resource shortages, delays in task dependencies, scope changes, and unforeseen internal or external obstacles.

Schedule variance is important in project management because it helps identify delays early, allowing project managers to take corrective actions to bring the project back on track. Managing schedule variance ensures that deadlines are met, which is critical for maintaining stakeholder confidence and avoiding costly delays.