The Iceberg Phenomenon in Project Management: How to Make "Invisible" Efforts Visible

Kathrin Jungwirth, Tuesday 29 October 2019 | Reading time: unknown

A project takes longer and costs more than expected - not uncommon. However, this is often the case even if none of the potential project risks have occurred and without bottlenecks endangering the success of the project. How can that be?

Each project has a workload of clearly visible time expenditure that flows into previously defined activities and work packages. In most cases, however, there is an additional proportion of "invisible" time expenditure, where even project managers cannot say exactly which tasks this time has been allocated to. This "iceberg phenomenon" represents a major problem in many projects, precisely because many managers neither calculate these hidden time expenditures nor know how much of the total effort they make up.

Estimates at this point would be untrustworthy, because these efforts can vary greatly from industry to industry and from project to project. To stick with the analogy of the iceberg - the part under water is the big unknown.

Time tracking is better than its reputation

So these hidden time expenditures must be somewhere in the project. They can only be made visible if all employees use a time tracking system in which they document all time spent on a project.

The impulse to introduce a time tracking tool usually comes from the managers or project managers - often when important projects are not completed on time or costs are incurred that nobody had previously expected.

In large companies, this acquisition can easily become a political issue: employees and the works council quickly suspect that this could be a monitoring measure that only serves to assess employees on the basis of key figures. The following three points should show why time tracking is much better than its reputation.

Time tracking helps to make projects profitable

Not infrequently, what is commonly referred to as "overhead" or "handling costs" is completely underestimated in projects. Employees spend much more time on coordination calls, e-mail communication and feedback loops with the customer than was assumed at the beginning of the project. But often these time efforts do not appear anywhere. The team members feel stressed because they take longer than expected to complete their project tasks and are under pressure to justify themselves.

Contractors in customer projects usually have two options: They themselves remain stuck with these costs. Alternatively, they can demand a handling fee from the customer. Experience has shown that this usually meets with little approval - most customers perceive it subjectively as much too high.

This is where time tracking systems become interesting. With their help, time expenditure can not only be allocated to individual team members and projects, but even to individual tasks or processes in the project. If employees use them thoroughly, the working hours for every phone call and every e-mail suddenly become visible.

This may sound very insignificant at first, but these processes are also work in and on the project, which would otherwise not been counted. On the other hand, customers can be shown in a transparent and credible manner how handling costs are generated and what costs subsequent change requests actually cause.

Time tracking helps to positively influence the group dynamics in the project team

Most team members are more motivated when they know that their contribution to the group's performance is evident to the leader. If this is not the case, then it can happen that team members who are actually high performers reduce their performance. This phenomenon occurs especially with simpler tasks, such as unpopular routine tasks (documenting, compiling reports, etc.).

A time tracking system also makes these contributions to project success visible and prevents the high performers in the team from losing the desire to work because part of their performance remains invisible anyway. It is important that the time tracking takes place almost on the side - i.e. with the help of appropriate software - without causing additional workload for the team members.

Time recording helps to learn from projects

It is difficult to avoid errors in estimations in projects. You should only make sure that you do not repeat the same errors in every project. If you know from past projects how much additional effort goes into certain tasks, you can take this into account when planning future projects and divide resources accordingly.

The granularity of the analysis is particularly important: only if you know exactly which tasks are potential sources of error in cost and time planning can you take concrete precautions. Project planners can also quantify administrative costs much more accurately and calculate how much additional effort each unplanned feedback loop means. The result are much more reliable time and budget plans.

Originally published in German in the projektmagazin blog on 02.06.2016: Das Eisberg-Phänomen in Projekten

Writer: Dr. Andreas Tremel

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