earned value
DESCRIPTION
earned value analysisTRANSCRIPT
-
What Is It ?
Why Do I Need It ?
How Do I Do It?Earned Value Analysis
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Todays SituationNeed for accurate and consistent status informationNumerous complex (and interrelated) projectsProjects with many WBS activitiesVirtual officesDiverse technology platforms
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Theres Room For Improvement70% of projects are:Over budgetBehind schedule
52% of all projects finish at 189% of their initial budget
And some, after huge investments of time and money, are simply never comple
Source:The Standish Group
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How to answer the question: Have we done what we said wed do?% complete estimating % of Budget spent% of work done% of time elapsedsubjective, incomplete draws false conclusions
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Enter Earned Value AnalysisEarned Value Analysis is:an industry standard way to:measure a projects progress,forecast its completion date and final cost, andprovide schedule and budget variances along the way.
By integrating three measurements, it provides consistent, numerical indicators with which you can evaluate and compare projects.
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Whats more Important?Knowing where you are on schedule?
Knowing where you are on budget?
Knowing where you are on work accomplished?
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EVA Integrates All ThreeIt compares the PLANNED amount of work with what has actually been COMPLETED, to determine if COST , SCHEDULE, and WORK ACCOMPLISHED are progressing as planned.Work is Earned or credited as it is completed.
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Earned Value needed because...Different measures of progress for different types of tasks
Need to roll up progress of many tasks into an overall project status
Need for a uniform unit of measure (dollars or work-hours).
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Earned Value needed because...Provides an Early Warning signal for prompt corrective action.
Bad news does not age well.
Still time to recover
Timely request for additional funds
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And One More ReasonWhy You Need EVA?
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Because You Gotta !These Set the Stage:GPRA; 1993FASA, Title V; 1994Clinger-Cohen Act; 1996And Then Along Came OMB! (Circular A-11, Part 7)"Agencies must use a performance based acquisition management system, based on ANSI/EIA Standard 748, to measure achievement of the cost, schedule, and performance goals."
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OK, So What Is This Stuff?
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So, Is This Stuff New ?Its been around since the sixties.
Cost/Schedule Control Systems Criteria(C/SCSC)
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Examples of informal Earned Value AnalysisIts done informally without realizing it.30% time used,30% $$ spentSo, if 30% of the work is done, I must be OK ??
Shop floor estimates
Cost comparisonsBudget vs. Actual
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Hows this project doing?
EVA Chart
500050005000
120001100012500
190001750019000
290002620029000
390003500039000
550004900055000
650005600065000
800003783437834
900003786537865
950003789537895
1000003792637926
1020003795637956
Project is:
13.8% Behind Schedule16.1% Over Cost
BCWS
BCWP
ACWP
Typical Chart
90008640
1800017280
2700025920
3600034560
4500043200
5400051840
6300060480
7200037834
8100037865
9000037895
9900037926
10800037956
Projected
Actual
Typical Data
1/1/032/1/033/1/034/1/035/1/036/1/037/1/038/1/039/1/0310/1/0311/1/0312/1/03
Projected900018000270003600045000540006300072000810009000099000108000
Actual8640172802592034560432005184060480
Factor0.96
EVA Data
1/1/032/1/033/1/034/1/035/1/036/1/037/1/038/1/039/1/0310/1/0311/1/0312/1/03
BCWS5000120001900029000390005500065000800009000095000100000102000
BCWP5000110001750026200350004900056000
ACWP5000125001900029000390005500065000
Schedule Variance0-1000-1500-2800-4000-6000-9000
Sched. Var. %0.0%-8.3%-7.9%-9.7%-10.3%-10.9%-13.8%
Schedule Perf. Index1.0000.9170.9210.9030.8970.8910.862
Cost Variance0-1500-1500-2800-4000-6000-9000
Cost Var. %0.0%-13.6%-8.6%-10.7%-11.4%-12.2%-16.1%
Cost Perf. Index1.0000.8800.9210.9030.8970.8910.8621.161
EAC 1
VAC 1
VAC % 1
EAC 2
Project is:
13.8% Behind Schedule16.1% Over Cost
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Lets Take A Look Under The Hood
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But First! - We gotta get organizedEVA works best when work is compartmentalized.
Compartmentalization is best achieved with a well-planned Work Breakdown Structure.
So, how do I create a WBS for a really complex project?
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Obviously in small bites.How am I gonna eat this elephant?
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Proper WBS DesignOne WBS per programDeliverable-orientedWork not in the WBS is out-of-scopeEach descending level represents more detailFull (and accurate) definition is keyDefined deliverable(s)Timeframe for delivery of productTotal cost (direct and indirect) to deliver product
Lets Look at an example:
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A sample Work Breakdown StructureServe Pizzas to CustomersProvide the PlaceCook the FoodServe Customers(Others)Cook the SauceMake the DoughBuild the Pizza
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WBS Units are Work PackagesLowest level WBS elements
Have an accompanying narrative
Have three measurable componentsScope of work to be accomplishedTotal (direct and indirect) costTimeframe for completion
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Control Account PlansA CAP is essentially a Work Package with some added features:Assignment of responsibilityOrganizationIndividualDivision (if necessary) into lower-level Work Packages.Metrics for measuring EV performanceMilestones% completeOther
The sum of the CAPs constitutes the Performance Measurement Baseline
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Enough With the WBS Stuff Already !We came here to talk about Earned Value.
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Some New TermsBCWS - Budgeted Cost of Work Scheduled
ACWP - Actual Cost of Work Performed
BCWP - Budgeted Cost of Work Performed
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Earned Value DefinitionsBCWS: Budgeted Cost of Work Scheduled
Planned cost of the total amount of work scheduled to be performed by the milestone date.
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BCWS - Budgeted Cost of Work Scheduled
Chart2
5000
12000
19000
29000
39000
55000
65000
80000
90000
95000
100000
102000
BCWS
EVA Chart
500050005000
120001100012500
190001750019000
290002620029000
390003500039000
550004900055000
650005600065000
800003783437834
900003786537865
950003789537895
1000003792637926
1020003795637956
Project is:
13.8% Behind Schedule16.1% Over Cost
BCWS
BCWP
ACWP
Typical Chart
90008640
1800017280
2700025920
3600034560
4500043200
5400051840
6300060480
7200037834
8100037865
9000037895
9900037926
10800037956
Projected
Actual
Typical Data
1/1/032/1/033/1/034/1/035/1/036/1/037/1/038/1/039/1/0310/1/0311/1/0312/1/03
Projected900018000270003600045000540006300072000810009000099000108000
Actual8640172802592034560432005184060480
Factor0.96
EVA Data
1/1/032/1/033/1/034/1/035/1/036/1/037/1/038/1/039/1/0310/1/0311/1/0312/1/03
BCWS5000120001900029000390005500065000800009000095000100000102000
BCWP5000110001750026200350004900056000
ACWP5000125001900029000390005500065000
Schedule Variance0-1000-1500-2800-4000-6000-9000
Sched. Var. %0.0%-8.3%-7.9%-9.7%-10.3%-10.9%-13.8%
Schedule Perf. Index1.0000.9170.9210.9030.8970.8910.862
Cost Variance0-1500-1500-2800-4000-6000-9000
Cost Var. %0.0%-13.6%-8.6%-10.7%-11.4%-12.2%-16.1%
Cost Perf. Index1.0000.8800.9210.9030.8970.8910.8621.161
EAC 1
VAC 1
VAC % 1
EAC 2
Project is:
13.8% Behind Schedule16.1% Over Cost
EVA Data
BCWS
-
Earned Value Definitions (cont.)ACWP: Actual Cost of Work Performed
Cost incurred to accomplish the work that has been done to date.
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ACWP - Actual Cost of Work Performed
Chart6
50005000
1100012500
1750019600
2620029900
3500039900
4900056000
3780337803
3783437834
3786537865
3789537895
3792637926
3795637956
BCWP
ACWP
EVA Chart
500050005000
120001100012500
190001750019600
290002620029900
390003500039900
550004900056000
650003780337803
800003783437834
900003786537865
950003789537895
1000003792637926
1020003795637956
Project is:
13.8% Behind Schedule16.1% Over Cost
BCWS
BCWP
ACWP
Typical Chart
90008640
1800017280
2700025920
3600034560
4500043200
5400051840
6300060480
7200037834
8100037865
9000037895
9900037926
10800037956
Projected
Actual
Typical Data
1/1/032/1/033/1/034/1/035/1/036/1/037/1/038/1/039/1/0310/1/0311/1/0312/1/03
Projected900018000270003600045000540006300072000810009000099000108000
Actual8640172802592034560432005184060480
Factor0.96
ACWP
1/1/032/1/033/1/034/1/035/1/036/1/037/1/038/1/039/1/0310/1/0311/1/0312/1/03
BCWP50001100017500262003500049000
ACWP50001250019600299003990056000
ACWP
BCWP
ACWP
BCWP
1/1/032/1/033/1/034/1/035/1/036/1/037/1/038/1/039/1/0310/1/0311/1/0312/1/03
BCWP50001200019000290003900055000
BCWP
BCWP
BCWS
1/1/032/1/033/1/034/1/035/1/036/1/037/1/038/1/039/1/0310/1/0311/1/0312/1/03
BCWS5000120001900029000390005500065000800009000095000100000102000
BCWS
BCWS
EVA Data
1/1/032/1/033/1/034/1/035/1/036/1/037/1/038/1/039/1/0310/1/0311/1/0312/1/03
BCWS5000120001900029000390005500065000800009000095000100000102000
BCWP50001100017500262003500049000
ACWP50001250019600299003990056000
Schedule Variance0-1000-1500-2800-4000-6000
Sched. Var. %0.0%-8.3%-7.9%-9.7%-10.3%-10.9%
Schedule Perf. Index1.0000.9170.9210.9030.8970.891
Cost Variance0-1500-2100-3700-4900-7000
Cost Var. %0.0%-13.6%-12.0%-14.1%-14.0%-14.3%
Cost Perf. Index1.0000.8800.8930.8760.8770.875
EAC 1
VAC 1
VAC % 1
EAC 2
Project is:
10.9% Behind Schedule14.3% Over Cost
-
Earned Value Definitions (cont.)BCWP: Budgeted Cost of Work PerformedThe planned (not actual) cost to complete the work that has been done.
-
BCWP - Budgeted Cost of Work Performed
Chart2
50005000
1100012000
1750019000
2620029000
3500039000
4900055000
37803
37834
37865
37895
37926
37956
BCWP
BCWS
EVA Chart
500050005000
120001100012500
190001750019600
290002620029900
390003500039900
550004900056000
650003780337803
800003783437834
900003786537865
950003789537895
1000003792637926
1020003795637956
Project is:
13.8% Behind Schedule16.1% Over Cost
BCWS
BCWP
ACWP
Typical Chart
90008640
1800017280
2700025920
3600034560
4500043200
5400051840
6300060480
7200037834
8100037865
9000037895
9900037926
10800037956
Projected
Actual
Typical Data
1/1/032/1/033/1/034/1/035/1/036/1/037/1/038/1/039/1/0310/1/0311/1/0312/1/03
Projected900018000270003600045000540006300072000810009000099000108000
Actual8640172802592034560432005184060480
Factor0.96
ACWP
1/1/032/1/033/1/034/1/035/1/036/1/037/1/038/1/039/1/0310/1/0311/1/0312/1/03
BCWP50001100017500262003500049000
ACWP50001250019600299003990056000
ACWP
BCWP
ACWP
BCWP
1/1/032/1/033/1/034/1/035/1/036/1/037/1/038/1/039/1/0310/1/0311/1/0312/1/03
BCWP50001100017500262003500049000
BCWS50001200019000290003900055000
BCWP
BCWP
BCWS
BCWS
1/1/032/1/033/1/034/1/035/1/036/1/037/1/038/1/039/1/0310/1/0311/1/0312/1/03
BCWS5000120001900029000390005500065000800009000095000100000102000
BCWS
BCWS
EVA Data
1/1/032/1/033/1/034/1/035/1/036/1/037/1/038/1/039/1/0310/1/0311/1/0312/1/03
BCWS5000120001900029000390005500065000800009000095000100000102000
BCWP50001100017500262003500049000
ACWP50001250019600299003990056000
Schedule Variance0-1000-1500-2800-4000-6000
Sched. Var. %0.0%-8.3%-7.9%-9.7%-10.3%-10.9%
Schedule Perf. Index1.0000.9170.9210.9030.8970.891
Cost Variance0-1500-2100-3700-4900-7000
Cost Var. %0.0%-13.6%-12.0%-14.1%-14.0%-14.3%
Cost Perf. Index1.0000.8800.8930.8760.8770.875
EAC 1
VAC 1
VAC % 1
EAC 2
Project is:
10.9% Behind Schedule14.3% Over Cost
-
The Whole Story
Chart4
500050005000
120001100012500
190001750019600
290002620029900
390003500039900
550004900056000
650003780337803
800003783437834
900003786537865
950003789537895
1000003792637926
1020003795637956
BCWS
BCWP
ACWP
EVA Chart
500050005000
120001100012500
190001750019600
290002620029900
390003500039900
550004900056000
650003780337803
800003783437834
900003786537865
950003789537895
1000003792637926
1020003795637956
Project is:
13.8% Behind Schedule16.1% Over Cost
BCWS
BCWP
ACWP
Typical Chart
90008640
1800017280
2700025920
3600034560
4500043200
5400051840
6300060480
7200037834
8100037865
9000037895
9900037926
10800037956
Projected
Actual
Typical Data
1/1/032/1/033/1/034/1/035/1/036/1/037/1/038/1/039/1/0310/1/0311/1/0312/1/03
Projected900018000270003600045000540006300072000810009000099000108000
Actual8640172802592034560432005184060480
Factor0.96
Combined Chart
1/1/032/1/033/1/034/1/035/1/036/1/037/1/038/1/039/1/0310/1/0311/1/0312/1/03
BCWS5000120001900029000390005500065000800009000095000100000102000
BCWP50001100017500262003500049000
ACWP50001250019600299003990056000
Combined Chart
BCWS
BCWP
ACWP
ACWP
1/1/032/1/033/1/034/1/035/1/036/1/037/1/038/1/039/1/0310/1/0311/1/0312/1/03
BCWP50001100017500262003500049000
ACWP50001250019600299003990056000
ACWP
BCWP
ACWP
BCWP
1/1/032/1/033/1/034/1/035/1/036/1/037/1/038/1/039/1/0310/1/0311/1/0312/1/03
BCWP50001100017500262003500049000
BCWS50001200019000290003900055000
BCWP
BCWP
BCWS
BCWS
1/1/032/1/033/1/034/1/035/1/036/1/037/1/038/1/039/1/0310/1/0311/1/0312/1/03
BCWS5000120001900029000390005500065000800009000095000100000102000
BCWS
BCWS
EVA Data
1/1/032/1/033/1/034/1/035/1/036/1/037/1/038/1/039/1/0310/1/0311/1/0312/1/03
BCWS5000120001900029000390005500065000800009000095000100000102000
BCWP50001100017500262003500049000
ACWP50001250019600299003990056000
Schedule Variance0-1000-1500-2800-4000-6000
Sched. Var. %0.0%-8.3%-7.9%-9.7%-10.3%-10.9%
Schedule Perf. Index1.0000.9170.9210.9030.8970.891
Cost Variance0-1500-2100-3700-4900-7000
Cost Var. %0.0%-13.6%-12.0%-14.1%-14.0%-14.3%
Cost Perf. Index1.0000.8800.8930.8760.8770.875
EAC 1
VAC 1
VAC % 1
EAC 2
Project is:
10.9% Behind Schedule14.3% Over Cost
-
Some Derived MetricsSV: Schedule Variance (BCWP-BCWS)A comparison of amount of work performed during a given period of time to what was scheduled to be performed.A negative variance means the project is behind schedule
CV: Cost Variance (BCWP-ACWP)A comparison of the budgeted cost of work performed with actual cost.A negative variance means the project is over budget.
-
Schedule Variance & Cost VarianceSchedule Variance = BCWP-BCWS
$49,000- 55,000SV = - $ 6,000
Cost Variance = BCWP-ACWP
$49,000 56,000CV = - $7,000
- Some More Derived MetricsSPI: Schedule Performance IndexSPI=BCWP/BCWSSPI
-
Performance MetricsSPI: BCWP/BCWS49,000/55,000 = 0.891
CPI: BCWP/ACWP49,000/56000 = 0.875
CSI: SPI x CPI.891 x .875 = 0.780
-
Making ProjectionsOnce a project is 10% complete, theoverrun at completion will not be lessthan the current overrun.
Once a project is 20% complete,the CPI does not vary from its currentvalue by morethan 10%.
The CPI and SPI are statistically accurate indicators of final cost results.
Source: Defense Acquisition University
-
Making ProjectionsToday
Chart5
500050005000
120001100012500
190001750019600
290002620029900
390003500039900
550004900056000
650005791566188.5714285714
800007128081462.8571428571
900008019091645.7142857143
950008464596737.1428571429
10000089100101828.571428571
10200090882103865.142857143
BCWS
BCWP
ACWP
EVA Chart
500050005000
120001100012500
190001750019600
290002620029900
390003500039900
550004900056000
650003780337803
800003783437834
900003786537865
950003789537895
1000003792637926
1020003795637956
Project is:
13.8% Behind Schedule16.1% Over Cost
BCWS
BCWP
ACWP
Typical Chart
90008640
1800017280
2700025920
3600034560
4500043200
5400051840
6300060480
7200037834
8100037865
9000037895
9900037926
10800037956
Projected
Actual
Typical Data
1/1/032/1/033/1/034/1/035/1/036/1/037/1/038/1/039/1/0310/1/0311/1/0312/1/03
Projected900018000270003600045000540006300072000810009000099000108000
Actual8640172802592034560432005184060480
Factor0.96
Projections
1/1/032/1/033/1/034/1/035/1/036/1/037/1/038/1/039/1/0310/1/0311/1/0312/1/03
BCWS5000120001900029000390005500065000800009000095000100000102000
BCWP50001100017500262003500049000579157128080190846458910090882
ACWP5000125001960029900399005600066189814639164696737101829103865
1.0000.9600.9690.9700.9770.9820.9820.9820.9820.9820.9820.982
CPI0.875
SPI0.8910.891
CSI0.7796250.875
Projections
BCWS
BCWP
ACWP
Combined Chart
1/1/032/1/033/1/034/1/035/1/036/1/037/1/038/1/039/1/0310/1/0311/1/0312/1/03
BCWS5000120001900029000390005500065000800009000095000100000102000
BCWP50001100017500262003500049000
ACWP50001250019600299003990056000
Combined Chart
BCWS
BCWP
ACWP
ACWP
1/1/032/1/033/1/034/1/035/1/036/1/037/1/038/1/039/1/0310/1/0311/1/0312/1/03
BCWP50001100017500262003500049000
ACWP50001250019600299003990056000
ACWP
BCWP
ACWP
BCWP
1/1/032/1/033/1/034/1/035/1/036/1/037/1/038/1/039/1/0310/1/0311/1/0312/1/03
BCWP50001100017500262003500049000
BCWS50001200019000290003900055000
BCWP
BCWP
BCWS
BCWS
1/1/032/1/033/1/034/1/035/1/036/1/037/1/038/1/039/1/0310/1/0311/1/0312/1/03
BCWS5000120001900029000390005500065000800009000095000100000102000
BCWS
BCWS
EVA Data
1/1/032/1/033/1/034/1/035/1/036/1/037/1/038/1/039/1/0310/1/0311/1/0312/1/03
BCWS5000120001900029000390005500065000800009000095000100000102000
BCWP50001100017500262003500049000
ACWP50001250019600299003990056000
Schedule Variance0-1000-1500-2800-4000-6000
Sched. Var. %0.0%-8.3%-7.9%-9.7%-10.3%-10.9%
Schedule Perf. Index1.0000.9170.9210.9030.8970.891
Cost Variance0-1500-2100-3700-4900-7000
Cost Var. %0.0%-13.6%-12.0%-14.1%-14.0%-14.3%
Cost Perf. Index1.0000.8800.8930.8760.8770.875
EAC 1
VAC 1
VAC % 1
EAC 2
Project is:
10.9% Behind Schedule14.3% Over Cost
-
Estimate to CompleteToday
Chart1
500050005000
120001100012500
190001750019600
290002620029900
390003500039900
550004900056000
650005791566188.5714285714
800007128081462.8571428571
900008019091645.7142857143
950008464596737.1428571429
10000089100101828.571428571
10200090882103865.142857143
10200095337108956.571428571
10200099792114048
102000101999.898116571.312
BCWS
BCWP
ACWP
116,571
EVA Chart
500050005000
120001100012500
190001750019600
290002620029900
390003500039900
550004900056000
650003780337803
800003783437834
900003786537865
950003789537895
1000003792637926
1020003795637956
Project is:
13.8% Behind Schedule16.1% Over Cost
BCWS
BCWP
ACWP
Typical Chart
90008640
1800017280
2700025920
3600034560
4500043200
5400051840
6300060480
7200037834
8100037865
9000037895
9900037926
10800037956
Projected
Actual
Typical Data
1/1/032/1/033/1/034/1/035/1/036/1/037/1/038/1/039/1/0310/1/0311/1/0312/1/03
Projected900018000270003600045000540006300072000810009000099000108000
Actual8640172802592034560432005184060480
Factor0.96
Projections
1/1/032/1/033/1/034/1/035/1/036/1/037/1/038/1/039/1/0310/1/0311/1/0312/1/031/1/042/1/043/1/044/1/045/1/046/1/047/1/048/1/049/1/04
BCWS5000120001900029000390005500065000800009000095000100000102000102000102000102000107000112000117000122000127000132000
BCWP5000110001750026200350004900057915712808019084645891009088295337997921020009533799792104247108702113157117612
ACWP5000125001960029900399005600066189814639164696737101829103865108957114048116571108957114048119139124231129322134414
1.0000.9600.9690.9700.9770.9820.9820.9820.9820.9820.9820.9820.9360.8940.8750.9820.9820.9820.9820.9820.982
Actual BCWS107000112000114478
CPI0.875
SPI0.8910.891
CSI0.7796250.875
Projections
BCWS
BCWP
ACWP
Combined Chart
BCWS
BCWP
ACWP
116,571
ACWP
1/1/032/1/033/1/034/1/035/1/036/1/037/1/038/1/039/1/0310/1/0311/1/0312/1/03
BCWS5000120001900029000390005500065000800009000095000100000102000
BCWP50001100017500262003500049000
ACWP50001250019600299003990056000
ACWP
000
000
000
000
000
000
000
000
000
000
000
000
BCWS
BCWP
ACWP
BCWP
1/1/032/1/033/1/034/1/035/1/036/1/037/1/038/1/039/1/0310/1/0311/1/0312/1/03
BCWP50001100017500262003500049000
ACWP50001250019600299003990056000
BCWP
00
00
00
00
00
00
00
00
00
00
00
00
BCWP
ACWP
BCWS
1/1/032/1/033/1/034/1/035/1/036/1/037/1/038/1/039/1/0310/1/0311/1/0312/1/03
BCWP50001100017500262003500049000
BCWS50001200019000290003900055000
BCWS
00
00
00
00
00
00
00
00
00
00
00
00
BCWP
BCWS
EVA Data
1/1/032/1/033/1/034/1/035/1/036/1/037/1/038/1/039/1/0310/1/0311/1/0312/1/03
BCWS5000120001900029000390005500065000800009000095000100000102000
EVA Data
0
0
0
0
0
0
0
0
0
0
0
0
BCWS
1/1/032/1/033/1/034/1/035/1/036/1/037/1/038/1/039/1/0310/1/0311/1/0312/1/03
BCWS5000120001900029000390005500065000800009000095000100000102000
BCWP50001100017500262003500049000
ACWP50001250019600299003990056000
Schedule Variance0-1000-1500-2800-4000-6000
Sched. Var. %0.0%-8.3%-7.9%-9.7%-10.3%-10.9%
Schedule Perf. Index1.0000.9170.9210.9030.8970.891
Cost Variance0-1500-2100-3700-4900-7000
Cost Var. %0.0%-13.6%-12.0%-14.1%-14.0%-14.3%
Cost Perf. Index1.0000.8800.8930.8760.8770.875
EAC 1
VAC 1
VAC % 1
EAC 2
Project is:
10.9% Behind Schedule14.3% Over Cost
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A New CriteriaActivities earn value as they are completed.The value earned is the WBS budgeted cost of the activity completed to date.
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Value of Earned ValueSchedule Status ReportingCost Status ReportingForecasting
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But How Do I Do All This Stuff ?With an Earned Value Management System
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A-11, Part 7 Requires an EVMS . . . based on ANSI/EIA Standard 748
And what does that mean?
ANSI/EIA 748 provides a list of guidelinesOrganizationPlanning, Scheduling, and BudgetingAccounting ConsiderationsAnalysis and Management ReportsRevisions and Data Maintenance
But, ANSI/EIA 748 doesnt identify approved systems
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A-11, Part 7 Requires an EVMSSo where do I get one?Buy a prepackaged one. (Lot of em around)Make your own.Microsoft ProjectMicrosoft Excel
Or it could be as simple as this:
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Requirements of Earned ValueProper WBS DesignBaseline Budget Control Accounts Baseline ScheduleWork measurement by Control Accountwork-hours, dollars, units, etc.Good Project Management Practices
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Shortcomings of Earned ValueQuantifying/measuring work progress can be difficult.Time required for data measurement, input, and manipulation can be considerable.
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SummaryEVA & EVMS will help reduce guesswork in:Measuring performanceforecastingNeed to get beyond misleading measures of progress.Reasons to use EVA and EVMS:Good project management practiceOMB requirementIncorporate into contracts
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Earned Value Resourceshttp://www.pmi.org/
http://www.acq.osd.mil/pm/
ANSI/EIA 748 is available from:Global Engineering Documents800-854-7179
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Some Compliant SystemsWelcom Cobra http://www.welcom.com/Schedulemakerhttp://www.schedulemaker.com/Planisware OPX2http://www.planisware.com/
RiskTrakhttp://www.risktrak.com/index.htmWinsighthttp://www.cs-solutions.comPrimavera Systemshttp://www.primavera.com
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Earned Value AnalysisQuestions/Discussion
(2) Those three measurements are:time expiredwork accomplishedmoney spent
(2) Thus the name Earned Value; you can actually assign a VALUE to the project at a particular timeGIPRA (performance measures): clearly define missions, set realistic goals, and report on accomplishments.
FASA Said you had to meet 90% of your goals (cost, schedule, and performance)
Clinger-Cohen Act - Tried to ensure that IT investments aligned with mission goals and that they are properly justified(also tried to ensure that systems are secure)
Change to A-11 in July 2002 (A real shot across the bow)Was developed by DoD (As are many very specific metrical techniques.You know, they like for everybody to be:walking in stepcounting cadence togethercalling out the same number,at the same time.
Was in response to a need to keep track of very large and very complex contracts.Were looking at a year-long project; Comparing our budget with our expenditures,Complete through about July, and we dont appear to be TOO far off track.
BUT, what we dont know is:How much WORK have we gotten done?How tough - in terms of BOTH time and money - will it be to get back on track?The more complex the project, the more difficult it is to tell where you are.
The WBS should describeWhat is to be doneWhen it is to be completedHow much it will costWBS needs to be broken down into manageable, meaningful pieces.
The danger here is in getting them too small.
The Work Package needs to be of the size that it can be handed off to a task manager.
Too large and you have multiple people responsible for the work.Too small and the program manager winds up micro-managing everything.
The accompanying narrative is really an SOW or Statement of Work.
If you get into EVA in depth, you may here about a CAP.
Previously called Cost Account Plan.
Thats probably the shortest course on Work Breakdown Structure youll ever see.
(And maybe the longest youll ever want to see.)OK, lets look at some real Earned Value stuff.The Work Package needs to be of the size that it can be handed off to a task manager.
Too large and you have multiple people responsible for the work.Too small and the program manager winds up micro-managing everything.
The accompanying narrative is really an SOW or Statement of Work.Sort of looks like the planned line doesnt it?
At this point, thats all it is. Were looking at how we expect to perform for the year.This is simply the actual cost to date.And heres that dreaded actual vs. planned situation.
Well the project is somewhat over cost.Somewhat could have a lot of different meanings.
So far weve spent 56K when we should have spent 49K.
OK, were 7K over budget, is that bad? Well, lets find out how bad.The next factor is BCWP and this is the factor that rounds out EVA and makes it possible to capture the full picture of where the project stands.
Note that this is the cost of the work performed and,it is the budgeted amount, not the actual amount.
SO, were about half-way through the year now, and you can see that the Budgeted cost of Work Performed is less than the Budgeted Cost of Work Scheduled.What does this mean?
It doesnt mean that weve spent less than we planned.Your looking at the cost of what should have been done. The project is behind schedule.
The significance of this situation becomes a lot clearer when you combine cost performance with schedule performance on one chart.And heres the full picture.The project is over budget by a thousand dollars.Weve only gotten 49 thousand dollars worth of work down. And what does that mean? - - - (were behind schedule.)
So what does all this mean?
Well, pay particular attention to the comparison of ACWP compared to BCWP. Oh Boy! Some derived metrics you were all waiting for some of those, werent you?
Cost Variance and Schedule Variance are simply arithmetic differences of where we are and where we should be.Simple arithmetic.
Weve accomplished $6,000 worth of output less than we should have
And were $7,000 over budget
We need some more derived metrics.Well, we know were behind schedule and over cost,and we know exactly much for each one, but so what?
Well, now we can begin to integrate these two pieces of information and get an overall picture.
The Performance Indices are really just a way of calculating, on a percentage basis, where we are.SPICPI
But now, when we combine the two, the percentage figure becomes more significant.
Too many numbers!
OK, were performing at about 89% of where we should be on performance,our cost performance is a little worse,
But look at the impact when you combine the two!
What do we do now? Unlike the stock market, in the program management world,Past Performance is an indicator of future results.
Lets take a look at what this would mean for our sample project.We can expect to finish the year having spent a bit more than was budgeted.
But look at the ACWP curve: We have only delivered 89% of the productbut weve spent everything we had, plus more.
Final line? Without a change in performance, we would have to spend an additional 28% of our budget to complete the job.
Why 28% when were only 11% behind? Because our Cost/Schedule Index says we will only be able to perform to a 78% level, and well continue to fall behind.Prepackaged EVMS may not fit in terms oflevel of WBStask description (SOW)flexibility for a variety of projects
Microsoft Project 2002 purported to support EVA
Calculations are simple in and of themselves.You need the WBS structure to be able to quantify output (what is the deliverable?)
Baselines provide a measuring stick.
And if there are not good management practices in place, it wont work.OMB requirements are going to be strongly focused on Project Management and Performance Measurement
But Earned Value makes sense without OMBs motivation
OMBs requirement applies specifically to contractors.