Software Development

What Is a Project Baseline and Why Is It Important

Project Baseline

You can hardly manage a project without making any changes to it. Sometimes, they even become a necessity – they help the project team deliver the product (or services) that meets the client’s requirements to the full.

At the same time, if we don’t keep these changes under control, they will backfire and lead to problems – uncontrolled expansion of project scope, delays, cost overruns, etc. So, we need a tool that would help us monitor the project’s progress and keep an eye on any changes made to it. This is where a project baseline comes into play.

What is a project baseline?

A project baseline is an approved variant of a project plan, which is used as a reference point to monitor project progress and overall performance, i.e. compare the actual state of a project with what has been planned.

A project baseline is usually established at the planning stage of the project lifecycle, but when major changes occur they should be baselined, too. At the same time, you should avoid a typical baselining mistake – replanning every time you make changes. In this case, there won’t be any baseline at all and you won’t be able to assess the project’s performance.

Planning and setting project baselines become much more simple with project management systems. For example, Epicflow, a multi-project resource management software solution, makes it possible not only to establish baselines for tasks and milestones but also to have a variety of tools to monitor the progress of every project running in a company as well as the state of the whole project environment.

Also read: 10 Effective Tips to Ensure Project Management Success

Why is a project baseline important?

Basically, a project baseline makes it possible to assess the project’s progress – whether and how much it has deviated from the initial plan. It also gives an insight into how changes have affected the project schedule, scope, and budget (e.g., changes to the project scope will affect its schedule and budget) and makes it possible to timely spot potential problems. A lack of baseline and control over changes can lead to scope creep and even project failure.
So, here are the main benefits of establishing a baseline.

  • More effective performance assessment: a baseline serves as a starting point to monitor how a project progresses
  • Timely detection of problems: regular monitoring helps identify issues in the workflow
  • Providing useful insights for future projects: comparing the actual workflow to the baseline makes
  • it possible to determine what worked well and what didn’t and use these insights for future projects.

Therefore, a project baseline is one of the prerequisites for fruitful work on a project.
Now that the essence of a project baseline is clear, let’s examine the types of a project baseline.

What are the types of baselines?

There can be three types of baselines corresponding to the triple constraints of project management: scope, cost, and schedule baselines. Each of them is equally important, must be approved by the stakeholders, and regularly monitored. They all are interdependent – as we’ve noted earlier, changes in one of the constraints will affect the others and the whole project outcomes. Let’s consider each baseline in more detail.

Scope baseline

A scope baseline is the approved scope statement along with the work breakdown structure and related WBS dictionary. Also, it should include detailed requirements for the project and its final deliverable. The scope of a project may change over time (for example, when clients request adding new features to the developed product), and the most significant changes should be re-baselined.

Schedule Baseline

A schedule baseline is a project schedule approved by the stakeholders. The main purpose of this baseline is to make sure that the work on a project sticks to the established timeline by tracking the delivered work in relation to the time spent. Also, a schedule baseline helps capture all changes made to the project timeline.

Cost Baseline

A cost baseline is a part of the approved version of the project budget that covers employees’ salaries, the cost of equipment and facilities, and other expenses required for project delivery. It doesn’t include the so-called “management reserve”, i.e. the funds provided for contingencies. A cost baseline helps compare the actual costs spent with the planned ones. In an ideal scenario, the spent costs are equal to the baseline and even lower. Otherwise, you are at risk of cost overrun.

It’s important to remember that changes to each type of baseline require formal approval. It means that every change request should be accepted only after a thorough analysis of its consequences for the workflow.

Let’s now review the cases when you may need to revise the established baseline.

Also read: Top 10 Microsoft Project Viewer Software

When to re-baseline

Sometimes, the established baseline may become irrelevant. For example, due to some external circumstances, you have to make significant changes to the project scope, timeline, or budget. In this case, it’s reasonable to change the initial baseline (or re-baseline).

Revising the baseline means documenting the required changes made to it and keeping track of these changes. From that moment, you use the updated baseline for monitoring how the project progresses.
So, in what cases is it reasonable to revise the baseline

  • When external circumstances make it impossible to follow the initial baseline
  • When the critical path changes due to delays or scope changes
  • When half of the milestones have been missed.

Of course, there can be many more reasons to revise the baseline, which will depend on a particular project or circumstances. But the main rule to be guided by is to re-baseline when the flow of changes makes the initial baseline inappropriate.

Conclusion

Let’s summarize the key points of the article.

  • Creating a project baseline is an important part of project management work: it allows project managers to monitor the project’s progress by comparing its actual state with what has been planned.
  • Regular monitoring of a project baseline helps keep the project on track.
  • There are three types of baselines corresponding to the triple constraints of project management – time, schedule, and scope.
  • When the initial baseline becomes irrelevant due to significant changes made to the project, you need to re-baseline.
  • Project management software (like Epicflow) helps establish baselines as well as provides numerous tools to track the project’s progress from different perspectives.
Written by
Delbert David

Delbert David is the editor in chief of The Tech Trend. He accepts all the challenges in the content reading and editing. Delbert is deeply interested in the moral ramifications of new technologies and believes in leveraging content marketing.

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