Effort Variance
Effort variance = [(Actual Effort -Planned Effort)/Planned Effort] * 100
It provides variance of Actual effort vs. Planned effort.
The effort variance may come out to be more than expected (e.g. we estimated that it will take 100 hours but in actual it took 110 hours, +10% effort variance)
Some of the causes why this variance might have occurred are:
1. Estimation parameters were wrong.
2. Scope was not understood in totality.
3. Inefficient process.
4. Someone changed the estimate without changing scope just to make the numbers match the preferred schedule.
5. Added capability the customer did not request.
The effort variance may come out to be less than expected (e.g. we estimated that it will take 100 hours but in actual it took 90 hours, -10% effort variance)
Some of the causes why this variance might have occurred are:
1. Estimation parameters were wrong.
2. There was an improvement in the process and brilliant work was done.
3. We did not complete the task and and probably missed on one or more requirements.
4. Missed out on some steps.
