WHY YOU NEED A BASELINE

A project baseline is a must if you wish to monitor and evaluate the success of your project. Without a baseline, you have nothing to measure yourself against either during or after the project is complete.

What is a project baseline?

The project baseline is, in essence, the projected values against which you are going to deliver the project.  While there are others, the most usual make-up of a project baseline is;

1. The budgeted cost i.e. how much you expect to spend in delivering the project.
2. The expected revenues i.e. how much you expect to make from the project including the profit margin. If the project is an internal/non-revenue generating project, then there is likely to be some other return that can be measured after implementation e.g. a new software product should result in time or cost efficiencies.
3. The project timeline i.e. when you expect to start and finish. This should be a combination of the whole project along with each major part of the delivery e.g. planning and design. Being able to measure the budgeting of time in each major project component allows you to see whether there are any problem areas in your projects generally that need improving.

Once you have established what your baseline is, the next important step is to record it somewhere. If it is not recorded, then it cannot be assessed against and is effectively meaningless.  The project baseline can be recorded in software products or it can be recorded in written form in a notebook somewhere. The key is to make sure that you have it.

Can a project baseline change?

Ideally, once the project baseline is set, it should not be changed. However, this is sometimes inevitable due perhaps to a requirement to implement a major change to scope or, hopefully not too often, the project was incorrectly base-lined in the first place.

If this situation occurs, then you should keep a reference of why have had to change the baseline, create the new one and then measure the project against this.

So why do I need a baseline?

Basically it is to allow you to see how well your projects are running.

1. It allows you to measure how accurate you are in your time estimation and consequentially improve in the estimation of future projects.  Are you allowing enough time for each section of the project? Are you over or under-estimating the work effort required for some projects? Are you building in sufficient contingency for customer created delays?….
2. It allows you to measure your ability to estimate and manage project costs. As with time estimation, budgetary understanding and management are integral parts of any project and you can learn by understanding where the money is going to whether efficiencies can be determined for future projects.

By using a baseline, you can measure your overall performance. It allows you to have something against which to compare your actual time/cost spends.

Without a project baseline, you can never fully understand your project effectiveness nor make any improvements for future projects that your business is delivering.

Are you defining and understanding your business project baselines?