50-50 rule used for work-in-process

FIGURE 15-15. Analysis showing use of 50/50 rule.

dollar expenditures for the project, regardless of percent complete. For example, we could say that 10 percent of the costs are to be "booked" for each 10 percent of the time interval. Another technique, and perhaps the most common, is the 50/50 rule:

Half of the budget for each element is recorded at the time that the work is scheduled to begin, and the other half at the time that the work is scheduled to be completed. For a project with a large number of elements, the amount of distortion from such a procedure is minimal. (Figures 15-15 and 15-16 illustrate this technique.)

One advantage of using the 50/50 rule is that it eliminates the necessity for the continuous determination of the percent complete. However, if percent complete can be determined, then percent complete can be plotted against time expended, as shown in Figure 15-17. There are techniques available other than the 50/50 rule5:

• 0/100: Usually limited to work packages (activities) of small duration (i.e., less than one month). No value is earned until the activity is complete.

5. These techniques, in addition to the 50/50 method for determining work in progress, are available in software packages.

Project Management Made Easy

Project Management Made Easy

What you need to know about… Project Management Made Easy! Project management consists of more than just a large building project and can encompass small projects as well. No matter what the size of your project, you need to have some sort of project management. How you manage your project has everything to do with its outcome.

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