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The next common mistake that people make with project management is thinking that an underspend is OK

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and this is surprisingly common.

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Again once you've seen this you're just You'll never make this mistake again once you've seen this.

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But you know suppose that I'm a million pound project and we're halfway through and I'm supposed to

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spend five hundred thousand.

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And suppose I've only spent 400000.

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Is that good.

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And it be easy to think.

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Well yeah I'm underspending.

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You know and I'm doing it cheaper than it was meant to be done that's great.

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But of course yes I might be underspending.

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But what also might be happening is I might be late.

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And which one is more likely that the first half turned out to be cheaper than I expected or that it

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turned out to be harder than I expected and it's taken me longer and it's going to be that second one

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isn't it it's going to be that I'm behind schedule.

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So underspend usually mean lateness.

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There are so many ways to be late.

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All you need is one person off sick one person was busy on another project and something went wrong

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and had to be done a second time or there was a task that we forgot and then we had to do it.

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There were so many ways to be behind schedule.

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And it's actually really difficult for things to be cheaper than you expected.

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So under spends usually mean lateness.

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So never think in underspend is OK.

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And it's particularly tricky because if you've got an overspending and lateness those effects cancel

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out.

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So imagine if I've only done half what I should have done but it's cost me twice as much to do that

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half that's going to look bang on on the spend or more likely imagine I've only done 90 percent of what

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I should have done.

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I'm slightly behind schedule but it's overspent a little bit it's cost me 110 percent.

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So that would mean I would be pretty much bang on on the spand.

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So you've got to be really careful looking at just the spend.

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The key is to separate out the two.

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And how do you do that.

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The answer is you look at the Gantt chart because the Gantt chart shows that you've done 90 percent

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of what you should have done.

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Then you immediately know that you're behind schedule and if the spent looks OK but you've only done

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90 percent that means you've actually overspent on that 90 percent because that's taking you back to

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the spend looking OK.

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So I think you could sum this up by saying Firstly always look at the gunshot to make sense of the money

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but also if you're underspent it probably means that you're behind schedule and that's probably because

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you've had a problem of some sort.

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And that problem will mean that in the end you'll end up spending a bit more than you planned.

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So underspent means late which means there's been a problem which means overspend now overspending just

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means you've overspent.

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So underspending or overspending means that in the end you will overspend on your project.

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And the only way we can come in on budget is to come in on time as well.

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And that's you know that's difficult.

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Most projects do overspend which is why we had contingency in.

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But the great thing is the Gantt chart shows everything you need.

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You don't have to do this guesswork of well and probably late I've probably had a problem.

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If you've got a Gantt chart which you should have you could just look at that and that will tell you

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whether the underspend is really a genuine underspend or whether more likely it's because you're behind

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schedule.