Work Performance Data and Variance Analysis
PMBOK v8 Definition
Work performance data represents the raw observations and measurements collected during project execution. This data includes specific work performance metrics for scope, schedule, budget, and quality that are defined at the start of the project as part of the project management plan. When this data is compared to the budget, the work performed, the resources used, and the funding schedule, it provides the context to determine if the project is on budget or if there is a variance.
Variance analysis is a technique for determining the cause and degree of difference between the baseline and actual performance. This technique reviews the differences (or variances) between planned and actual performance, using mathematical models to forecast future outcomes based on historical results.
Why It Matters for the Exam
This concept appears frequently in PMI exam questions related to Monitoring and Controlling Process Group, particularly in Cost Management and Schedule Management knowledge areas. Questions test your understanding of how raw data transforms into meaningful information for decision-making, and how variance thresholds trigger preventive or corrective actions.
Key Points to Remember (for the exam)
- Three Levels of Performance Information: Data (raw measurements) → Information (data with context) → Reports (compiled for decisions)
- Variance Analysis Components: Reviews cost, time, technical, and resource variances from an integrated perspective
- Key Input for Decision Making: Work performance data plus additional information (budget, funding schedule, resources used) provides sound foundation for project decisions
- Variance Thresholds: Defined in the project management plan; comparing actual variance to thresholds determines if preventive or corrective action is required
- Schedule Baseline: Approved timeline for tasks and milestones; schedule baseline updates are formal modifications when significant changes occur
- Work Performance Reports: Physical or electronic representations of work performance information compiled in project documents, intended to generate decisions, actions, or awareness
Typical PMI Exam Example
A project manager reviews cost data showing $50,000 expended. To determine if the project is on budget, the manager must compare this data to the budget, work performed, resources used, and funding schedule. The variance analysis reveals a $5,000 overspend. Comparing this to the variance threshold of 5% in the project management plan indicates corrective action is required.
PMI Exam Traps
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Trap: Confusing work performance data with work performance reports Reality: Data is raw measurements; reports are compiled representations intended to generate decisions
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Trap: Thinking variance analysis only looks at cost or schedule separately Reality: Variance analysis reviews variances from an integrated perspective considering cost, time, technical, and resource variances together
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Trap: Assuming all variances automatically require corrective action Reality: Variances must be compared to variance thresholds in the project management plan before determining if action is required
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Trap: Believing schedule baseline updates are minor adjustments Reality: Schedule baseline updates are formal modifications for significant changes and must be formally integrated into the plan
Important PMI Connections
| Related Concept | Relationship Type | Exam Attention Point |
|---|---|---|
| Project Management Plan | Contains variance thresholds | Thresholds determine when preventive/corrective action is triggered |
| Schedule Baseline | Component of project management plan | Baseline updates require formal integration when significant changes occur |
| Cost Baseline | Compared to actual expenditures | Cost baseline + management reserve = project budget |
| Funding Requirements | Provides context for variance analysis | Funding schedule helps determine if project is on budget |
Quick Review Questions
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What three levels of performance information exist, and how do they relate to each other?
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When comparing work performance data to the plan, what additional information provides context to determine if the project is on budget?
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What determines whether a variance requires preventive or corrective action?
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What is the difference between work performance data and work performance reports?
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How does variance analysis review variances from an integrated perspective?
PMBOK v8 Reference
Section 4.5 - Monitoring and Controlling Project Work Section 6.6 - Control Schedule Section 7.4 - Control Costs Section 8.3 - Control Quality