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Most of projects willing to calculate the project progress based on the cost, as this is the way to measure the project revenue and the cash flow. However, I believe the best way to measure the project progress should be thru Man hours as this way can give us a real and physical indications for the actual work progress. For example, for road projects some main activities on site like earth works require a long time and machine works to be completed but with minor revenue, however other activities like asphalt laying can take short time but with a very high revenue, so it is a matter of compromise.
Cost or Man-hours is not an accurate way to measure the progress. The completion percentage of each task shall be measured by the quantity completed and approved by the client. then according to the weight of each task in terms of value or effort (cost or Man-hour the total progress of the project will be calculated. when you tie your Project to the Bill of quantity it will be easy and more accurate to use the cost as a weight for the tasks.
You select metric based on your required measurement.
1. In order to measure Schedule Progress you would use Man-hours.
2. In order to measure Cost efficiency on the project you would use Planned vs Actual Cost.
man hour units. and it may depend if we are increasing a amn hour unit with a unskillled labour then we wont get any good results.
Cost based is more accurate
Procurments activities must measured by using Cost while all other activities depend in measurments on Manhoures.
The Cost Ratio method is usually implemented on a project , this technique is measured based on the budgeted allocation of currency vs. the labour hours of production.
in the Percentage of completion method for the revenue recognition for long period projects ( under US GAPP ) Percentage of completion is the accumulated cost incurred (up to the time of calculation) divided by the total estimated cost for the whole project ( actual incurred + estimated remaining )
Percentage of completion = Cost Incurred / Total cost estimated
Project work progress can only be calculated by the manhour units.
Earned Value Management (EVM) is a technique that can help you measure the project progress in terms of cost.
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Cost base is recommended most accurate.
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