CPI,SPI,EAC.ppt

EARNEDVALUEMANAGEMENTSYSTEMAProjectPerformanceTool,ByRoyT.Uemura,PMP,P.E.,MBAProjectManagementConsultantProjectProfessionals,LLC,HowIsYourProjectDoing?,Aheadofschedule?WithinyourapprovedBudget?,HowIsYourProjectDoing?,Whatisyourcostestimateatcompletion?Willyoubeaheadorbehindthescheduledcompletiondate?,Agenda,ExplanationofEarnedValueManagement(EVM)Thetraditional“TwoDimensionalSystem”ofEvaluationEVM“ThreeDimensionalSystem”ofEvaluationCriticalVariablesinEVMEVMFormulasApplyingEVMonprojectsExample,EarnedValueManagement,Methodforintegratingscope,schedule,andresources,formeasuringprojectperformance.Compareswhatwasplannedwithwhatwasactuallyspentwithwhatwasactually“earned”,EarnedValueManagement,Developedinthe1960sPopularmethodforreportingandcontrollingprojectintheDepartmentofDefenseAcommonlanguagetoreportprogressandcostagainstaprojectHelpsanswerthequestions:Areweonschedule?Howmuchdidtheworkwedocost?Aretherevariances?Basedonthesetrends,howmuchwillitcostbytheendoftheproject?,EarlyWarningSystem,“basedontheProjectPerformancePlanandProjectsActualPerformanceagainstthePlan,theprojectwilllikelytakethismuchtimetofinish,andspendthismuchmoney.”,TraditionalSystem(TwoDimensional),Cost:compareswhatwasplannedtobeexpendedversuswhatwasactuallyexpendedTime:ComparesthedateyouareonaprojectversuswhentheprojectistobecompletedProduction:Compareshowmuchworkwasplannedtobecompletedversushowmuchwasactuallycompleted.,EarnedValue(ThreeDimensional),1.Actualworkthatwas“earned”versus2.Workthatwasaccomplishedversus3.Workthatwasscheduledtobeaccomplished,CriticalVariablestoEVPerformanceIndices,QualityoftheprojectbaselineplanActualperformanceagainstbaselineplanManagementsdeterminationtocontrol(change)thefinalresults,ProjectBaseline,BasisofperformancemeasurementRepresentstechnical,costandscheduleobjectivesoftheprojectCashflowsOutsideMaterialOutsideServices,ScopeofWork,ThescopeofworkofentireprojectmustbedefinedTheWorkBreakdownStructure(WBS)identifiesandgroupsmajordeliverablesIntegratescopewithbudgetandschedule.,PerformanceMeasurementMethods,Fixedformulabytask:0/100%,25/75%,50/50%WeightedMilestonesPercentcompletebasedonspecificwork(milestone)accomplished.PercentCompleteIncrementcompleted/totalactivityortaskEquivalentCompletedUnits,CostAccountPlan,ProjectDescription,Installedapproximately14.5milesoftransmissionlineofwhichabout4,000feetwasinstalledunderground.Installed93steelpoles:52polesweredirectburiedand41weremountedonpierfoundations.,Kuilima,Waialua,VisualProgressReport,Foundation:DugConcretePouredPoleErection:LinesStrung:Trench:ConduitInstalled:CableInstalled:TrenchCovered:,Kuilima,Waialua,ControllingChange,Essential:ChangeManagementControlSystemintheProjectPlanpreventsincorrect,inappropriate,orunauthorizedchangestotheproject.InformappropriatestakeholdersofauthorizedchangestotheBaseline(scope/quality,schedule,cost),EVMInputDataRequired,PLANNINGPHASEPlannedValue(PV)BudgetAtCompletion(BAC)%Complete-PlannedEXECUTING&CONTROLLINGPHASESActualCost(AC)%Complete-Actual,CalculationsfromInputData,EarnedValue-EVCostVariance-CVScheduleVariance-SV,CalculationsforAnalysis,CostPerformanceIndex-CPISchedulePerformanceIndex-SPIBudgetatCompletion-BACEstimatetoCompletion-ETCEstimateatCompletion-EACToCompletePerformanceIndex-TCPI,PrimaryDataElements,PV(PlannedValue)Thevalueoftheamountofworkthatwasplannedtobeaccomplishedonatask(oraproject)asofacertaindateinthebaselineplan.BAC(BudgetatCompletion)Totalcostofatask(orproject)accordingtothebaselineplan.,AC(ActualCost)Theactualamountofmoneyspentonatask(orproject)asofacertaindate.,PrimaryDataElements(contd),PerformanceAnalysis,EV(EarnedValue).Thevalueoftheamountofworkactuallycompletedonatask(orproject)asofacertaindate,accordingtothebaselineplan.EV=%ActualCompletexBAC,CV(CostVariance)Thedifferencebetweenthevalueofworkthatwasactuallycompleted(EV)onatask(orproject)andthecostthatwasactuallyspend(AC)onthetask(orproject)asofacertaindate.CV=EV-AC(+$=spendinglessthanplanned),PerformanceAnalysis(contd),SV(ScheduleVariance)Thedifferencebetweenthevalueofworkthatwasactuallycompleted(EV)onatask(orproject)andtheworkthatshouldhavebeendone(PV)asofacertaindate.SV=EV-PV(+$=AheadofSchedule),PerformanceAnalysis(contd),CPI(CostPerformanceIndex)Theratioofthevalueofworkactuallycompleted(EV)onatask(orproject)andamountactuallyspent(AC)onatask(orproject)asofacertaindate.CPI=EV/AC(1=Spendinglessthanplanned),PerformanceAnalysis(contd),SPI(SchedulePerformanceIndex)Theratiobetweenthevalueofworkthatwasactuallycompleted(EV)onatask(orproject)andtheworkthatshouldhavebeendone(PV)asofacertaindate.SPI=EV/PV(1=AheadofSchedule),PerformanceAnalysis(contd),PerformanceAnalysis(contd),ETC(EstimateToCompletion)Theforecastedcostoftheremainingtask(orproject)iscalculatedbyCPIorCPIxSPIETC=RemainingWork/CPI=(BAC-EV/CPIorETC=RemainingWork/(CPIxSPI)=(BAC-EV/(CPIxSPI),EAC(EstimateatCompletion)Thevalueexpressedineitherdollarsorhourstorepresenttheprojectedfinalcostofworkwhencompleted.TheEACequalstheactualcosts(AC)incurredplustheestimatedcoststocompletetheremainingwork(ETC).EAC=AC+ETC,PerformanceAnalysis(contd),PerformanceAnalysis(contd)RangesofEstimateatCompletion,High-EndProjection(CumulativeCPIxSPI)EAC=AC+(BAC-EV)/(CPIxSPI)In-BetweenProjection(80%CPIx20%SPI)EAC=AC+(BAC-EV)/(0.8CPIx0.2SPI)Low-EndProjection(CumulativeCPI)EAC=AC+(BAC-EV)/CPI,ToCompletePerformanceIndex,TCPI:ProjectperformancewhichmustbeachievedonallremainingworkinordertomeetthefinancialgoalbymanagementTCPI=WorkRemaining/FundsRemaining=(TotalBudget-Earnedvalue)(BAC-ActualCosts)=(BAC-EV)(BAC-AC),PMPExam,EstimateAtCompletion(EAC)EAC=BACCPIEstimatetoComplete(ETC)ETC=EAC-ACRitaMulcahy,PMPExamPrep5thEdition(2005),Example,Time:4thmonthof10monthscheduleBudgetatCompletion:BAC=$10,000PlannedValue:PV=$4,000ActualCost:AC=$3,800Actual%Complete:36%EarnedValue:EV=0.36x$10,000=$3,600,Time,3,BAC,$10,000,$5,000,1,6,7,AC=$3,800,EV=$3,600,StatusDate,PV=$4,000,EarnedValueAnalysis,2,4,5,8,9,10,TraditionalAnalysisCostVariance:=PlannedExpenditure-ActualCostCV=PV-ACCV=$4,000-$3,800=$200(underspentby$200)EarnedValueAnalysisCV=EV-ACCV=$3,600-$3,800=-$200(spendingmorethanplannedforworkperformed)SV=EV-PVSV=$3,600-$4,000=-$400(lessworkwasdonethanplanned),PerformanceAnalysis,PerformanceAnalysis,CostPerformanceIndex(CPI)CPI=EV/ACCPI=$3,600/$3,800=0.95(1,forevery$1spent,only$0.95inphysicalworkwasdone)SchedulePerformanceIndex(SPI)SPI=EV/PVSPI=$3,600/$4,000=0.9(1,forevery$1ofphysicalworkplanned,only$0.9wasdone),PerformanceAnalysis,EstimateToComplete(ETC)ETC=(BAC-EV)/CPIETC=(BAC-EV)/(CPIxSPI),PerformanceAnalysis,EstimateAtCompletion(EAC)EAC=AC+(BAC-EV)/(CPIxSPI)=3,800+(10,0003,600)/(0.95x0.90)=$11,285(highend)EAC=AC+(BAC-EV)/CPI=3,800+(10,0003,600)/0.95=$10,537(lowend),PerformanceAnalysis,ToCompletePerformanceIndex(TCPI)TCPI=(BAC-