actual costs

[katto1]

Are there recommended practice for entering integrating actual costs into a risk analysis?

[Intaver Support]

If you are not using resources as part of your cost calculations then it is straight forward. As activities are completed, you can update cost either in your management schedule or in RiskyProject in the Income and Cost view. On the other hand, if you are using a resource loaded schedule to calculate costs, you will need to make some decisions about how best to integrate actual costs into your analysis. Typically forecasting costs uses resource allocation and rates with the Fixed Units tasks type duration. During simulations when durations are updated during each iteration, Work and therefore projected resources costs are recalculated for each resource and task in the project. This process works very will for forecasting resources costs when durations are uncertain. But it can create logical conflicts when entering actuals.

If during project execution, you continue to use the above process, where costs are calculated based on duration, resource allocation, and rates then you can continue. Problems occur if you mix methodologies such that you calculate future costs based on the above formula, but you manually enter actuals for work in for tasks or resources. This causes calculations to become decoupled with the forecast method. The reason for this is if tasks that are partially completed, there are now 2 sources of Actual cost data: calculated work based on duration, % complete, and resource allocation; and Actual Work entered for a Tasks or a Resource. This can become even more complicated when resources are assigned to n>1 activity.
If this is the case, you have two options.

One, create a copy of your schedule so that you one that can be used for running risk analysis that uses the Fixed Units, % Complete, and Resource allocation to calculate Actuals. In most cases, this will be adequate as the point of running the analysis is not to calculate where you are, but forecast what the implications of current progress means to meeting schedule and budget.

Two, you can use manually entered Work, but you will need to remove any uncertainty from the Task Duration by setting the Task types for incomplete tasks to Fixed Duration.

From our standpoint, there are trade offs that need to be balanced from both approaches based on how your organization wants to manage their projects and the resources that are available to run your risk analysis.