New to the forum… and hopefully my response is still relevant.
I am responsible for project planning and tracking where I work. I follow recommended project management practices as documented by the Project Management Institute (PMI).
Specifically, I use charters to ensure projects activities align with business goals; proposals to document specifications, costs, deliverables and schedules; plans to document tasks, assign resources, schedule work, mitigate risks and track the project; change requests, sparingly, to adjust projects in execution; and post-mortems to learn from successes and failures encountered during project execution.
Creating a project schedule requires me to create a work breakdown structure (WBS). This is where I break down the project in tasks, sub-tasks, sub-sub-tasks and so on. I will be as detailed as possible and I will estimate the required effort based on past experience. Experience is the most important determinant in how well one estimates a project. Discussing estimates with those who will be responsible for the work – team leaders, developers, designers, etc. – is important.
Creating a schedule also requires me to assess risks, resource capabilities and resource availabilities. Risks include missed tasks, incorrect estimates, lack of resources, resource failures and a host of other potential factors. I suggest mitigations for each identified risk and factor that into my schedule estimate in the form of slack time (as suggested by @Torsten) and contingency.
Keep in mind that slack time allows you to deliver on time, however does nothing regarding budget. A contingency takes into account unexpected expenditures.
Once all of this is done and the project is started, I check its progress weekly and sometimes daily. Developers let me know when tasks are completed (tasks are either done or not, no in-betweens) and how much time was spent. I determine if a project is on time and budget by looking at its earned value and projecting it out to the remainder of the project. If projections show the project is on or below the expected burn rate, great. I talk to the development team and the customer otherwise. This is when I have to be a bit of a wolf. Not fun!
Keep in mind managing scope creep is super important. A constantly moving target is impossible to estimate or complete. Also… post-mortems are important. That is how you and your team gain experience and become better.
What tools do I use? A project management application called Merlin. It does pretty much everything I need: WBS; costing; Gantt chart; resource levelling; critical path; risk assessment; earned value; and more. We are in the process of looking for an alternative due to a change in licensing terms. There are a number of these tools out there.
There are also applications and web services that say they are project management apps… but are really collaboration apps. These typically do not calculate earned value for you and lack a number of other features. That said… they typically have lower initial cost of ownership, have a lower learning curve and work well for some types of teams and projects.
Hope this helps.