What Does Work in Progress Mean in Different Industries?
Each industry sector measures work in progress according to its specific operational patterns and reporting needs. In construction projects, WIP represents active building phases, material usage, and labor hours invested in incomplete work.
Manufacturing tracks parts and assemblies moving through production lines, while software teams measure features and modules under development. Service industries monitor active client deliverables against contract milestones.
Industry-specific work in progress applications include:
- Construction projects track structural elements from foundation to finishing, including labor hours, installed materials, and equipment usage at each build phase
- Production operations measure raw materials, partially assembled products, and items awaiting final processing across multiple manufacturing stages
- Software development monitors features in coding, testing, and deployment preparation, tracking progress through sprint cycles and release milestones
- Professional services record billable work performed, client deliverables in creation, and project phases awaiting completion
- Healthcare facilities track ongoing treatment protocols, patient care procedures, and service delivery progress
- Engineering firms measure design work, technical documentation, and project specifications under development
Modern project management systems provide real-time visibility into WIP status across different operational areas. These metrics help teams balance workloads, optimize resource allocation, and maintain steady progress toward completion targets. Regular WIP monitoring enables quick identification of bottlenecks and proactive schedule adjustments to keep projects on track.
How is Work in Progress Calculated?
Construction teams calculate WIP value by adding materials installed, labor hours worked, and overhead applied to unfinished project elements. Manufacturing facilities measure WIP by combining raw materials used, production labor costs, and factory overhead for items still in assembly. Project accountants track these costs against total contract values to determine completion percentages.
The basic WIP calculation formula is:
WIP Value = Direct Materials + Direct Labor + Applied Overhead
For more detailed project tracking:
Percentage Complete = (Total WIP Value ÷ Total Contract Value) × 100
Standard WIP calculation components combine:
- Direct material costs applied to incomplete work ($50,000 in structural steel, $25,000 in concrete materials)
- Direct labor charges for unfinished tasks (500 worker hours × $75/hour = $37,500)
- Equipment usage rates for ongoing activities (120 crane hours × $200/hour = $24,000)
- Overhead allocation for work underway (25% of direct costs = $34,125)
- Contract change orders affecting scope ($15,000 in approved additions)
- Value of stored materials not yet installed ($75,000 in pending materials)
- Percentage complete based on earned value metrics (Actual Cost ÷ Budget = 35%)
Project managers calculate WIP value monthly to measure physical progress against cost baseline and financial investment For example, a $1,000,000 contract showing $350,000 in WIP represents 35% completion based on actual costs. Monthly WIP calculations provide essential data for financial reporting and help teams forecast remaining work accurately.
What Goes into a Work in Progress Report?
A work in progress report captures current project status across active construction phases and incomplete project elements. This essential project control document tracks cost values, completion percentages, and remaining work for each contract item currently under development.
Critical project elements in WIP reports include:
- Current costs incurred for materials, labor, and equipment usage on active work items
- Percentage complete calculations for each major project component in progress
- Estimated costs to complete remaining work based on contract values
- Schedule progress showing planned versus actual completion dates
- Change order impacts on contract scope and project values
- Resource allocation across ongoing construction activities
- Quality control status for work completed to date
- Cash flow projections based on pending work completion
Project managers review WIP reports monthly to validate construction progress and financial performance, often using tools like s curve analysis to visualize trends. These reports help teams identify schedule variances, track budget compliance, and maintain accurate project forecasts through completion. Regular WIP reporting provides stakeholders with clear visibility into project health and expected outcomes.
How to Record Work in Progress?
Project teams record work in progress through construction cost tracking systems that document costs, resources, and completion status for active tasks. Daily or weekly WIP updates capture labor hours worked, materials installed, and overhead costs applied to ongoing project elements.
Essential WIP recording steps include:
- Daily documentation of labor hours and materials used on active work items
- Weekly updates of equipment hours and resource consumption rates
- Regular verification of installation progress and quality checks
- Accurate cost coding to assign expenses to correct project phases
- Systematic tracking of change orders affecting ongoing work
- Proper documentation of stored materials and pending installations
- Regular validation of percentage complete calculations
Project cost management software helps teams maintain accurate WIP records through integrated time sheets, cost reports, and progress tracking tools. These digital systems ensure consistent documentation while providing real-time visibility into project status across all active work phases.
What is the Difference Between Work in Progress and Work in Process?
Work in progress typically refers to construction and project-based activities tracking incomplete building elements and ongoing site work. Work in process commonly describes manufacturing operations monitoring items moving through production lines toward finished goods inventory.
Key distinctions between these terms:
- Work in progress tracks long-term project phases requiring multiple steps
- Work in process measures short-term production cycles with defined endpoints
- Progress terms focus on construction and development activities
- Process terms apply to manufacturing and assembly operations
- Progress monitoring spans weeks or months of project work
- Process tracking covers hours or days of production time
Industry standards generally accept both terms while recognizing their slightly different applications. Construction and project teams prefer "work in progress" while manufacturing operations typically use "work in process" for production tracking.
When Do Projects Track Work in Progress?
Projects track work in progress from the start of physical construction or production until final completion and handover. WIP tracking begins when teams mobilize resources and start actual work activities, continuing through all project execution phases to monitor progress against schedule and budget targets.
Critical WIP tracking points include:
- Construction mobilization when site work begins
- Material deliveries entering production cycles
- Active installation of project components
- Milestone completion measurements
- Payment application periods
- Monthly financial reporting cycles
- Schedule update reviews
- Quality control inspections
Regular WIP monitoring helps project teams maintain control over schedule performance and budget compliance throughout execution. These consistent tracking cycles provide early warning of potential delays while enabling quick response to emerging issues.
What Makes an Effective WIP Management System?
An effective WIP management system captures accurate progress data while enabling quick analysis of project performance metrics. Modern project control platforms integrate cost tracking, schedule updates, and resource monitoring to maintain current status across all active work phases.
Key elements of successful WIP systems:
- Real-time progress tracking linked to project schedules
- Automated cost coding tied to contract items
- Digital documentation of installed quantities
- Mobile apps for field progress updates
- Integrated quality control checklists
- Automated calculation of earned values
- Clear reporting dashboards
- Stakeholder notification workflows
Construction teams rely on structured WIP management to maintain project cost control and ensure successful delivery. These systems provide essential data for financial reporting while helping teams optimize resource allocation and workflow efficiency.
WIP Reporting Dashboard Example
By leveraging Mastt, project owners and project managers can enhance their management of WIP, leading to more efficient project execution and successful outcomes.
Track work-in-progress details, budgets, and project health using Mastt's visual dashboard.
