Understanding Construction Progress and Percent

Complete Reporting
By Les Zinger

Overview
There are many misunderstandings of what % complete actual means and
what it represents on any construction project. This paper will explain the
different methods of reporting progress, what is required to develop and
track the project progress curve, differentiate the differences between
reporting progress by DURATION % Complete and % complete based on
PHYSICAL PROGRESS. The goal of this paper is to help management
understand the following:

What is being reported as progress or % complete and the actual

status of the project may be very different and misleading based on
the methodology being invoked.
The best method is based on physical % complete for the activity. This
is determined by the actual quantity installed vs. the budget quantity
for that activity
The second method would be the actual amount of resources used vs.
the budgeted amount as per the resource loading. This can be very
misleading based on the performance index for that activity. You could
use 100% of the resource and only complete 50% of the work or use
50% of the resources and complete 100% of the work.
The third and most misrepresentative, which is the methodology used
by all versions of MS Projects is duration % complete.
There are only 2 methods in which activities & projects can
relate to each other:
o Monies ( cost value)
o Man-hours
In order to related the activities and projects together to
calculate weighted values they must have either one or the
other, Money or Man-hours, as the common denominator.

In depth analysis of the methodology referenced above.

Physical percent complete In order to use this method you

need 2 of the following items;
o The quantity of the item to be installed based on the units
in the Eskom task order for that contract.
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o The labor cost of that activity. (Eskom 95% of the time

supplies all the material, thus the amount stated in the
task order has a very high reliability to compose of 98100% total labor). This cost along with the quantities, unit
rates, total cost should be in the Eskom Task orders line
items when they are property completed.
o With a correctly resource loaded schedule the total number
of man-hours for that activity can used in lieu of the
activity cost. Currently there only exists one contractor that
is correctly resource loading the schedule in their propriety
schedule done in PSNET. Unfortunately due to contract
issues these resources are not being exported into P6 when
the conversion from PSNET to P6 is done.
o All the schedules provided to Eskom with resources
included are as follows:
Just thrown in MS_Project to fulfill a request from
Eskom and not really the resources that contractor
will use on the task,
Resources provided on highly level summary
activities such as methodology used by Rotek.
NO resources are included in their Excel, MS Project
Gantt (bar chart) or MS_Project schedule.
o Based on this we are very suspicious to determine any
progress based on resources.
Resources Actual vs. planned
o The problem with this method is that to maintain an SPI
(Schedule performance index) of 1.0 for any sustained
period or multiple craft disciplines is not realistic. The SPI is
typical used for monitoring the schedules performance as a
whole for Actual vs., Planned. A SPI below 1.0 is bad since it
indicates you are not performing as the plan. A SPI above
1.0 indicates that you Are performing better than planned
(Note.- some companies use SPI and CPI which are inverse
of this where less than 1.0 is good and greater than 1.0 is
bad) The Number of resources to do a task/ install a
specific quantity can be determined 1 of 4 ways:
The companies own estimating standards based
many historical data points of actual similar work
performed in the past.
Industry standard estimating books such as R.S.
Means or Richardsons.
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An estimating software program in which depending

on the program used the resource quantity will vary.
To determine the amount and type of resources
required based on personal experience or the
experiences of others.
o The resource quantity can be used in another way- Earned
Man-Hours. In this method you multiple the activitys %
complete by the activitys total man-hours expended to
date to determine Earned Valve based on man-hours
earned. The issue still remains how to determine the
activitys % complete. The only accurate method is
quantity installed vs. planned quantity.
Duration percent complete
o Duration % complete is the least accurate of any method.
The basis of thinking for this is that the level of effort of
every activity is directly proportional to its duration.
o It simple terms if you have an activity to order a bolt and
the fabrication and shipping time to site has a duration of
20 days. When it arrives you earn the same about of
progress as welders working 20 days and making 400
welds. It is simple to demonstrate how this methodology is
totally erroneous.
o MS Project methodology that ESKOM has been
accepting is Duration % complete. This why the all
the consultants to Eskom have been stating that
currently there exists no realistic or analytical
method of accurately determining the outage %
complete with any reasonable certainty.
o This is one of the reasons why ESKOM is moving to P6
which has several methodologies to determine within a
reasonable level of error the outages % complete.
Currently the best and most accurate method of
calculating the outage actual % complete within an
acceptable level of error is physical % complete.
o For this method to work it requires the outage coordinators
to prepare correct and accurate contracts and task orders
from the contractors estimate and scope documents.
These contracts/task order must contain the following:
A task order which is identical to the scope
documents with every element list as a line item.
Each contract/task order line item must contain:

Quantity to be installed
Unit rates for labor
Total labor cost
From these signed contracts/task orders we have a
basis to quantify and cost the line items so they can
inputted into P6.
The budget quantity and total LABOR cost for each
activity corresponding task order line item number
will give the data necessary to determine physical %
complete of that activity by tracking the actual
quantity installed to the budget.
This gives the common denominator, Monies, in
which to relate that activity to all other activities in
the same project and to all the other projects in the
schedule. This is a method of calculating an
accurate weighted value for each activity in
the project and Integrated schedule.
The key to making this successful is to include any
quantity changes due to scope changes. As
additional scope and activities are added or deleted
they must contain both the quantity to be installed
and the total cost of the activity as per the approved
change order.
If scope changes reduce the scope for these activities
the affected quantities and cost must be reduced as
per the approved change order.
This will require both Engineering and the
outage controllers to complete their changes
documentation on time and in accordance with
the PCM for change management.
Several formats exist in P6 for adding the cost and
quantities which will have to be followed along with a
global change to aid in the calculations for deriving at
the performance % complete.
The performance % complete will be valid for every
WBS and Project this will allow rolling up to the total
outage performance % complete to the WBS, Project
and Outage levels.