This document discusses project control processes and earned value management. It provides examples of how to build a project baseline, record actual costs and progress, calculate earned value, and use earned value metrics like CPI, SPI, ETC and EAC to estimate project completion costs and schedule. Key aspects of earned value covered include defining the planned value, earned value, actual costs, variances, and using ratios like CPI and SPI to forecast project performance and completion.

1. COLLEGE OF ENGINEERING
Construction Management
Group 3
By
1- Saleh Aladdadh
2- Naif Alharbi
3- Salman Almansor
Submitted to .Dr.
Tomas Ucol Ganiron, Jr

2. PROJECT CONTROL PROCESS
- What is Controlling Process
- PM responsibility
2

3. Advanced Control: An
Overview
I attribute my success to
this: I never gave or took
an excuse.
Florence Nightingale
3

4. PROJECT CONTROL PROCESS
Purpose : to ensure that project objectives are met by monitoring and
measuring progress and taking corrective actions when necessary
4

5. Progress Measurement
If we don’t change our
direction, we are likely to end
up where we’re headed.
Anonymous
5

6. Traditional Approaches to Progress
Measurement
• Budget vs. actual
• Percent complete
• “Trust me”
6

7. Modern Approaches
• Smaller projects or projects with unstable
scope:
– Weekly or biweekly deliverables
– Done or not done
• Larger projects:
– Earned value
7

8. Earned Value Concepts
8

9. Earned Value Mechanics
• Build (and plot) your baseline
• Record (and plot) the actuals
• Measure (and plot) progress
9

10. Build Your Baseline
• Information developed by planning:
– WBS with 108 technical activities and 18
management activities.
– Estimates show that all 126 activities will
require 1 person for 1 week.
– You are constrained to have three full-time
staffers plus one half-time project manager.
– Staff and PM both cost $1,000 per week.
10

11. Build Your Baseline
Month Staff PM Total
1 $12,000 $2,000 $14,000
2 $12,000 $2,000 $14,000
… … … …
9 $12,000 $2,000 $14,000
$108,00 $126,00
Total $18,000
0 0
11

12. Plot Your Baseline
Scheduled Cost
($126,000)
Cumulative
Values
Time
12

13. Record Your Actuals
Month # Staff Staff $ PM Total
$12,00 $14,00
1 3.5 $2,000
0 0
$12,00 $14,00
2 3.5 $2,000
0 0
$16,00 $19,00
3 4.7 $3,000
0 0
$16,00 $18,00
4 4.5 $2,000
0 0
n/a $56,00 $65,00
Total $9,000
0 0
13

14. Plot Your Actuals
Scheduled Cost
($126,000)
Cumulative
Values
Actual
Cost
($65,000)
Time
14

15. Measure Your Progress
Earned value = budget for completed item
Mo. Done Not Staff PM Total
$12,00
1 10+2 2 $10,000 $2,000
0
$11,00
2 9+2 5 $9,000 $2,000
0
$15,00
3 13+2 4 $13,000 $2,000
0
$18,00
4 16+2 0 $16,000 $2,000
0
$56,00
Tot. 56 n/a $48,000 $8,000 15
0

16. Plot Your Progress
Scheduled Cost
($126,000)
Cumulative
Values
Actual
Cost
($65,000)
Earned Value ($56,000)
Time
16

17. Use Ratios to
Estimate Completion
• Cost Performance Index (CPI) =
Earned Value / Actual Cost
• Cost Estimate At Completion (Cost EAC) =
Total Scheduled Cost / CPI
• Schedule Performance Index (SPI) =
Earned Value / Scheduled Cost
• Schedule EAC = Planned Duration / SPI
17

18. Sample Earned Value Calculations
• Cost Performance Index (CPI) =
56,000 / 65,000 = 0.86
• Cost Estimate At Completion (Cost EAC) =
126,000 / CPI = 126,000 / 0.86 =
146,500
• Schedule Performance Index (SPI) =
56,000 / 56,000 = 1.00
• Schedule EAC = 9 months / 1.0 = 9 months
18

19. Other Earned Value Acronyms
• SC = BCWS = PV
– Budgeted Cost of Work Scheduled
– Planned Value
• AC = ACWP
– Actual Cost of Work Performed
• EV = BCWP
– Budgeted Cost of Work Performed
19

20. More Earned Value
Acronyms
Estimate
Budgeted At Completion
d
(BAC)
Overrun
Estimate To
Actual Cost
Complete (ETC)
Estimate At Completion (EAC)
20

21. Sample Values
Total Scheduled Cost = 3,500
Cumulative
Values
Actual Cost = 1,800 Duration =
12 months
Budgeted Cost = 900
Earned Value = 600
Time
21

22. Sample Earned Value Calculations
• Cost Performance Index (CPI) =
600 / 1,800 = 0.33
• Cost Estimate At Completion (Cost EAC) =
3,500 / CPI = 3,500 / 0.33 = 10,500
• Schedule Performance Index (SPI) =
600 / 900 = 0.67
• Schedule EAC = 12 months / 0.67 = 18 months
22

23. … continued
Budget =
Estimated Overrun = 7,000
3,500
Actual
Cost Estimate To Complete (ETC) =
=
8,700
1,800
Cost Estimate At Completion (EAC) = 10,500
23

24. Interpreting Results
• Negative is bad:
– If CV < 0, you are over budget.
– If SV < 0, you are behind schedule.
• Less than 1.0 is bad:
– If CPI < 1.0, you are over budget.
– If SPI < 1.0, you are behind schedule.
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25. Time Variance
• Earned Schedule (ES) — the number of
periods planned for the current Earned Value.
• Actual Time (AT) — the number of periods
that have elapsed since the project started.
• TPI (Time Performance Index) = ES / AT
25

26. … continued …
Scheduled Cost
Cumulative
Values
AT = 22
PD = 52
ES = 18
Earned Value
Time
26

27. … continued
• Time to Complete (TC) =
Planned Duration / TPI =
52 / 0.8 = 65 = 13 weeks late
• SPI will give similar results early in the project,
but becomes less reliable later.
27

28. Summary of
Key Points
• Earned value is the most reliable approach to
progress measurement when scope is
reasonably stable.
• Keep work-items small and short to avoid
measurement errors.
28