P6 Forecasting Electors

Use the cost from the most accurate and complete cost source as the forecast cost in Primavera P6

• Get the best project cost forecasts as early as possible
• Have more time to react to changing circumstances
• Know which costs to include for the most accurate forecast even when there are multiple sources of cost information

Problem

Accurately forecasting project cost is a critically important part of project management. This is made challenging by the number of sources of cost information, each of which becomes available at a different point during the project lifetime and each of which has its own degree of accuracy. Generally speaking, the earlier cost information is known, the better, as it affords more time to make decisions based on what the cost is likely to be and adapt to changing circumstances. However, the later the source of cost information that is used, the more accurate it is likely to be.

This principle can be easily illustrated by looking at the extremes. At the time the estimate is prepared, the least information is available, and the information is the least likely to be accurate -- but the entire time span of the project is available to make or change the plan based on this information. At the other end, once all the costs are through accounting, there is complete certainty about what the costs actually are -- but it is too late to do anything about it.

When using P6 to track project costs, the situation is further complicated by the fact that the different costs might be added to P6 at different times, and the fact that a cost source might not yet have all of the costs related to an activity.

Solution

Emerald Associates has developed P6 Forecasting Electors, which are able to consume the different sources of cost information and make intelligent decisions about which cost source is the most likely to be accurate for each activity in the P6 project, and elect the cost from that source as the forecast cost. When combined with interfaces to other systems, such as contract management, LEMS, or accounting systems, this enables us to provide the most accurate available forecast to project stakeholders as early as possible, maximizing the time available to react to changing circumstances.

The P6 Forecasting Electors use rules to ensure that the best, latest cost is used for forecasting purposes. Generally later phases are more accurate, but earlier phases might be more complete (for example, during activity execution the field costs will not be complete). The P6 Forecasting Electors will intelligently choose the best cost in this circumstance.

Experience

• Trident Exploration Corp. - Large Coal Bed Methane drilling contractor working on hundreds of wells in a year
• Tarpon Industries - Medium sized modular manufacturing company
• Caracal Energy - Integrated oil producer and supplier

Users

Anyone who wants to track cost information in P6 and needs accurate cost forecasting, especially if they are collecting cost information from other systems either manually or through automated system integration.