The effects of optimistic and pessimistic biasing on software project status reporting

Anecdotal evidence suggests that project managers (PMs) sometime provide biased status reports to management. In our research project we surveyed PMs to explore possible motivations for bias, the frequency with which bias occurs, and the strength of the bias typically applied. We found that status reports were biased 60% of the time and that the bias was twice as likely to be optimistic as pessimistic. By applying these results to an information-theoretic model, we estimated that only about 10–15% of biased project status reports were, in fact, accurate and these occurred only when pessimistic bias offset project management status errors. There appeared to be no significant difference in the type or frequency of bias applied to high-risk versus low-risk projects. Our work should provide a better understanding of software project status reporting.