S Curve
An S-curve is a visual representation of the project budget over time. The curve is named after its “S” shape. The “S” shape is caused by the gradual increase in project development speed, followed by a slow-down during the project’s closure. This form of project progression causes a curve that represents the budgeted value to take the shape of an “S”.
Project managers use the curve to track progress. They also use it to identify potential performance issues. The curve also helps to compare the project’s current progress with its predicted progress. Consequently, it is possible to understand if any changes are necessary.
S-curves types
The baseline S-Curve expresses the budgeted cost for the work scheduled. The project manager creates the curve when the responsible stakeholders approve the budget. The project manager has to change the S curve if change requests are approved.
The target S-Curve represents a constraint on the amount spent to perform work throughout the project. The project manager creates this curve when the project has financial restrictions.
The actual S-Curve represents funds actually spent over time. It evolves as the project spends resources to perform work. The project manager assesses progress by comparing the S-Curves with what the team did at a given time.
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How to use the S-Curve
Project managers and senior management must make informed decisions. They can rely on the curve to understand “what should have been done”, “what are the available funds”, and “what was spent”. This way, it is possible to track progress and assess variances. Specifically, the project manager may compare the value of the work done with the value of the planned work. Furthermore, it is possible to compare the amount spent with budget restrictions.
Advantages of Using an S-Curve
Firstly, it is possible to use the curve to track progress. Unfortunately, projects do not always evolve according to the plan. Specifically, many issues and risks may arise throughout the project. Consequently, project managers need a tool to track progress. They may therefore, rely on the S-curve to understand the planned value and the actual costs.
Secondly, it is possible to use the curve to forecast cash-flow needs. The curve provides an understanding of when the project needs funds and when they are available.
Thirdly, the project manager may use the curve to allocate resources. The curve provides information when the project needs resources. Consequently, it is easier to allocate these physical and human resources.
Fourthly, the curve can help to manage expectations. In other words, the curve provides a realistic view of project progress to stakeholders.
Finally, the project manager can compare the activities earliest dates with their latest dates. In other words, it detects if activities have some schedule flexibility.
In summary, an curve shows the use of resources throughout the project. This management tool can in fact be helpful. It helps to track progress and assess variances.