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Project Performance Measurement Earned Value A Starter

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A simple slideshow looking at EVA as a Project Performance tool

A simple slideshow looking at EVA as a Project Performance tool

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    Project Performance Measurement   Earned Value   A Starter Project Performance Measurement Earned Value A Starter Presentation Transcript

    • Project Performance Measurement -Earned Value
      Simon Robertson
      © 2010 Robertson Consulting Ltd
      June 2010
    • Benefits of EVM
      An up-to-date accurate status of the project
      Solid input to proactively make corrections
      Allows managing stakeholder expectations
      Historic reference for future estimates
      No surprises to the customer
      More accurate representation of on-time completion
      © 2010 Robertson Consulting Ltd
      2
    • MSProject 2010 & EVM
      When? Just after you develop the Schedule…..
      3
      © 2010 Robertson Consulting Ltd
    • MSProject 2010 & EVM
      Important Issue Indicators
      Cost overrun – may be working additional hours to keep timeline
      Time overrun – may be availability of resources limited
      Cost and Time overrun – may be project control, poor quality, rework was necessary
      Steps to prepare
      Ensure all Resources and Materials are in MSProject
      Ensure all planning complete and schedule agreed
      Establish project baseline from where the variances will be calculated and presented
      Add Columns to reflect the EV measures
      Prepare project management documents to meet the tracking and reporting requirements from the various project stakeholders
      Set expectations with the project team, address any concerns and get buy-in
      © 2010 Robertson Consulting Ltd
      4
    • MSProject 2010 & EVM
      Typical Measures
      Planned Value (PV) – amount budgeted to be spent between task’s start date and the status date
      Actual Cost (AC) – amount spent while preforming work on a task during a given period
      Earned Value (EV) – amount that that should have been spent for a given percentage of work performed on a task
      © 2010 Robertson Consulting Ltd
      5
    • MSProject 2010 & EVM
      Typical Variance Metrics
      Cost Variance(CV) – links spending to earned value
      CV = EV – AC or BCWP - ACWP
      Schedule Variance (SV) – links the work accomplished (earned) with planned
      SV = EV – PV or BCWP - BCWS
      © 2010 Robertson Consulting Ltd
      6
    • MSProject 2010 & EVM
      Typical Performance Indicators
      Cost Performance Index
      CPI = EV/AC or BCWP/ACWP
      Schedule Performance Index
      SPI = EV/PV or BCWP/BCWS
      Critical Ratio (?)
      CR = CPI x SPI or BCWP2/ACWP x BCWS
      © 2010 Robertson Consulting Ltd
      7
    • MSProject 2010 & EVM
      Typical Forecasting Metrics
      Estimate at Completion (EAC)– apply CPI and SPI as performance factors (PF)
      Mathematical EAC (uses PF = 1)
      EACm = (BAC – EV) + AC
      or EACm = BAC – CV
      Low End EAC (uses PF = CPI)
      EACL= [(BAC-EV)/ (CPI)] + AC
      Or EACL = (BAC)/ (CPI)
      High End EAC (uses PF = CPI x SPI)
      EACH= [(BAC – EV)/(CPI x SPI)] + AC
      © 2010 Robertson Consulting Ltd
      8
    • MSProject 2010 & EVM
      Typical Cost Corrective Action Metrics
      To Complete Performance Index (TCPI)
      TCPI = (Work remaining)/ (Funds Remaining)
      To stay within original BAC
      TCPI = (BAC – EV) / (BAC – AC)
      To stay within newly forecasted LRE where baseline remains at original BAC
      TCPI = (BAC – EV) / (LRE – AC )
      Where LRE (Latest Revised Estimate)
      LRE (or EACE) = ETC + AC
      © 2010 Robertson Consulting Ltd
      9
    • MSProject 2010 & EVM
      Typical Schedule Corrective Action Metrics
      To Complete Schedule Performance Index (TCSPI)
      TCSPI = (Unearned Duration Remaining)/ (Actual Duration Remaining)
      To stay within original PMB
      TCSPI = [PD – (AD)(SPI)] / [(PD - AD)]
      To stay within the latest revised Schedule (LRS) where baseline remains at original PMB
      TCSPI = ([PD – (AD)(SPI)] / [(LRS - AD)]
      © 2010 Robertson Consulting Ltd
      10
    • Typical Information Collection Table
      © 2010 Robertson Consulting Ltd
      11
    • CV = EV – AC (BCWP – ACWP)
      CPI = EV/ AC ( BCWP / ACWP)
      SV = EV – PV (BCWP – BCWS)
      SPI = EV/PV (BCWP/BCWS)
      CR = CPI x SPI ((BCWP2 / (ACWP x BCWS))
      STATUS DATE
      Analysis Design Develop Deploy Operate
      Earned Value Analysis
      12
      © 2010 Robertson Consulting Ltd
    • Earned Value Useful Notes
      Main EV measures:
      CV = EV – AC (BCWP- ACWP)
      SV = EV – PV (BCWP-BCWS)
      Above result “0” is on target
      CPI = EV/AC (BCWP/ACWP)
      SPI = EV/PV (BCWP/BCWS)
      CPI, SPI = 1 is on target
      CR = CPI x SPI
      CR >= 1.0 is good
      Integrates Scope, Time and Cost
      • Cost Variance (CV)
      • Schedule Variance (SV)
      • Time Variance (TV)
      • Earned Value (EV = BCWP)
      • Actual Cost (AC = ACWP) – (if per time = Burn rate)
      • Planned Value (PV = BCWS)
      • Budget at Completion (BAC)
      • Schedule at Completion (SAC)
      • Cost Performance Index (CPI)
      • Schedule Performance Index (SPI)
      • Critical Ratio (CR)
      13
      © 2010 Robertson Consulting Ltd
    • Can I help further?
      Training in Earned Value
      PMI Training
      Project Consultancy – making it work on the ground
      Project Management Maturity Model Assessment
      Organisational Maturity Model Assessment
      Bespoke Training or facilitation solutions
      Simon Robertson
      +44 (0)7967300344
      simon@robertsonconsulting.co.uk
      14