Forecasting in project management

Project forecasting is predicting what will happen in the project based on data. It means looking at the current status information and figuring out what the performance will be by the end of the project. 

Why is it important to forecast in project management? 

• It allows project managers to understand (even in the early stages), where the project is headed and if necessary take corrective actions
• It requires capturing data, status and trends (something that is otherwise many times neglected)
• It reveals the impact of the current performance rate on the project results (an impact that one not always notice).
• It helps understanding which behaviors and trends should be changed and take the needed action before it’s too late

 So it’s all about using data to predict where the project is headed, and take the right actions to make changes as an if needed. 

Why is it not very common then? 

First due to the challenge of data capturing. It is easier for projects that are working with PM tools , but not easy at all for other projects. 

Second, a lot of the times it is lack of experience and the belief that the data that tells you what happened so far, does not necessarily reflect on what’s going to happen. 

Here’s what’s interesting to understand: 

Problematic trends in projects never improve on their own. 

Trends that deteriorate in projects never improve on their own

 There is no magic in project management 

PMs need to do something different and make changes for things to improve.

So what PMs should do until the new PM tools have built in AI in them (and some of them are on the way): 

• Identify the project trends they should follow and build the framework to capture this data 
• Use the trends to forecast the project path ahead as far as progress, timeline, budget, quality
• Identify immediate corrective actions for problematic trends

Few common examples – Project progress rate, velocity , budget consumption, user stories completion and more. 

To sum, prediction is a very powerful tool, proving to us time and time again, that in order to predict what will happen, one needs to understand history and current reality. 

Once we learn to use it, we can be much less surprised, and much more proactive, in the projects we run.

Thanks!