earned value presentation -12022007

7/28/2019 Earned Value Presentation -12022007

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1

EARNED VALUE MANAGEMENT

SYSTEM

MOHAMMED YASSIN AL – NAFI, BSC, PMP

Community & Business Services Department

Planning & Business Support

EVMS

EVMSEVMS

EVMS



2

In This Presentation….

What Is Earned Value…?

Questions To Be Answered.

Benefits Of Earned Value.

Terms & Formulas.

Build Earned Value Management System.

Example To Analyzing.

Scenarios Discussion.

Data Displaying.

Conclusions.



3

Is a Process That Integrates

Scope, Schedule and Cost

Elements of a Program / Project

for Effective Planning and Control.

What Is Earned Value?



4

Questions to be Answered…?

Are we on schedule?Are we on cost?

What are the significant variances?

Why do we have variances?

Who is responsible?

When will we finish?

What will it cost at the end? What will it cost to the end?

How can we control the trend?

Where is the problem areas?

We analyze the past performance...to help us control the future.

PAST PRESENT FUTURE

!..?



5

Benefits of EVMS

It is a single management control system that provides reliable data.

It integrates work (Scope), schedule and cost using a work breakdownstructure (WBS) & Organization Breakdown Structure (OBS).

The associated database of completed projects is useful for comparativeanalysis ( Lesson Learned ).

It uses an index-based method to forecast the final cost of the project. Enable to use management by exception principle that can reduce

information overload.

Quantifies technical progress in cost and schedule terms - (Time and $) - provides Project Manager with the ability to pinpoint and focus on problem areas at the contract .

Provides the basis for forecasting future performance, verification of corrective actions taken and establishment of reliable Estimates atCompletion (EAC).

Facilitates a mutual understanding of scope, schedule and

budget planning .



6

Terms & Formulas



7

Terms & Formulas – 1

(Input Data)

BCWS Budgeted Cost of Work Scheduled

(PV) Planned Value.

BCWP Budgeted Cost of Work Performed(EV) Earned Value.

ACWP Actual Cost of Work Performed

(AC) Actual Cost.

BAC Budgeted at Completion.

AC EV

PV

BAC



8

Terms & Formulas - 2

(Variances)

Cost Variance :

CV$ = EV – AC ( - ) Unfavorable , ( +) favorable

Cost Variance % : CV% = (CV$ / EV) * 100 ( - ) Unfavorable , ( +) favorable

Schedule Variance : SV$ = EV – PV ( - ) Unfavorable , ( +) favorable

Schedule Variance % : SV% = (SV$ / PV) * 100 ( - ) Unfavorable , ( +) favorable



9


(Variances)

Variance At Completion :

VAC$ = BAC – EAC

( - ) Over Budget

( + ) Under BudgetVariance At Completion % :

VAC $ % = (BAC – EAC) * 100 / BAC

= (VAC $ /BAC) * 100

( - ) Over Budget

( + ) Under Budget



10


(Performance Indices)

Cost Performance Index : CPI = EV / AC > 1 (Underrun) ; < 1 (Overrun) ; 1 (On Budget)

Schedule Performance Index :

SPI = EV / PV > 1 (Ahead) ; < 1 (Behind) ; 1 (On Schedule)

Cost Schedule Performance Index :

1 - CSPI = CPI * SPI

2 - CSPI = 0.8CPI * 0.2SPI To Complete Performance Index

Work Remaining / Budget Remaining

TCPI = (BAC-EV) / (BAC-AC)



11


(Estimate at Completion) & (Estimate to Complete)

EACt Estimate at Completion (Time):

EACt = ( BAC/SPI)/(BAC/Project Duration )

EACt = ( Project Duration / SPI )

EAC$ Estimate at Completion ($):

1 - EAC$ = BAC/CPI

2 - EAC$ = AC + (BAC – EV )/CPI

3 - EAC$ = AC + [(BAC – EV )/(CPI * SPI)]

4 - EAC$ = AC + [(BAC – EV )/(0.8CPI *0.2SPI)]

ETC Estimate To Complete1 - ETC = EAC - AC (Future)

2 - ETC = BAC - EV (Past)

Let’s See Your

Project’s EAC.!!?



12


(Overall Status)

Percent Completed :

= (EV/ BAC)* 100 Percent (Work Completed)

Percent Spent (Budget) :

= (AC/BAC)*100 Percent (Budget Spent)

Percent Scheduled := (PV /BAC)*100 Percent (Time Elapsed)

This Is Your

Mistake….!?

You Want More

% Completed..!?



13

BUILD EVMS



14

Earned Value Measurement Techniques

Apportioned Effort

EV = Completed Units * Unit’s Budgeted Cost

EV = % Completed * PV

EV = PV , Example Project Management Effort

For Supportive Tasks {Example (QA/QC)}

EV = % of Earned Value of The Main Task

0 % 100 %

25 % 75 %

50 % 50 %

15% 20% 35% 30%

• No Tangible Outcome

• Tangible Outcome

Fixed Formula

(Tasks With 1-2 Planning Periods )

Weighted Milestone

(Tasks With Longer Duration )

Units Complete

Percent Complete (Simple & easy) D i s c r e t e P a c k a g e s

Level of Effort



15

Responsibility Allocation Matrix (RAM)

& Control AccountsWork Breakdown Structure

(WBS)

O r g a n i z a t i o n B

r e a k d o w n S t r u c t u r e

( O B S )

1 2 3 4 5 6 7 8

A

B

C

D

E

F

Assignment of a single

work element to a single

team allows better control

and Facilitates roll-up of

efforts In both directions.

Control Accounts (CA)

Where Project’s Scope,

Cost and Schedule are

Planned , Managed &

Controlled



16

Project

Tasks

Sub -

Tasks

WorkPackages

Level

1

2

3

4

5

Work Breakdown Structure

Masonry

Wall

1.4.4

Floor

Slab

1.4.3

Footing

1.4.2

Sitework

1.4.1

Interior

Finishes

Roof

System

SteelColumns& Joints

PlaceFootings

1.4.2.3

Form &ReinforceFootings

ExcavateFootings

1.4.2.1

F - 11

1.4.2.3.3

F - 3

1.4.2.3.2

F - 1

1.4.2.3.1

Landscape1.3

Mobiliz.1.2

Admin.1.1

MainFacility

1.4

Warehouse

1

Jobs



17

ORGANIZATION BREACKDOWN STRUCTURE

( OBS)

ORGANIZATION

CEO. / p.

B.LINE

ED / VP

B.LINE

ED / VP

B.LINE

ED / VP

B.LINE

ED / VP

FUNCTIONAL UNIT

DEPART.MR

FUNCTIONAL UNIT

DEPART.MR

DIVISION

SUPERVISOR

SECTION

SUPERVISOR

INDIVIDUAL

B.LINE

ED / VP

DIVISION

SUPERVISOR

B.LINE

ED / VP

INDIVIDUAL



18

Contract Budget Breakdown

FIXED F.

WP’s

AE

WP’s

Lo E

WP’s

MIL.

WP’s

WORK PACKAGES PP’S

Control Accounts Budgets UB

Performance Measurement Baseline (PMB) MR

TOTAL ALLOCATED BUDGETPROFIT /

FEES

Mgt. Reserve

Undistributed Budget

Planning Packages

Level of EffortApportioned EffortFixed Formula Milestone

Contract Price

• MR=Budget withheld By Contractor PM For Unknown/Risk Mgt.

• UB=Activities Not Yet Distributed To Cost Accounts.

• PP’s=Far Terms Control Accounts Activities Not Yet

Defined Into Work Packages.



19

BUDGET DISTRIBUTION

TARGET PRICE

(BUDGET FOR FUNDING PERIOD)

FEE / PROFIT

PROJECT OPERATING BUDGET

(ESTIMATE COSTS)

MANAGEMENT

RESERVE

LEVEL 1

BUDGET DISTRIBUTED

TO TASK MANAGERS

LEVEL 2

TASK BUDGET

LEVEL 3

SUB-TASK BUDGET

LEVEL 4

JOB BUDGET

LEVEL 5WORK PACKAGES BUDGET

TIME

PLAN

COST

PLAN

TARGET PRICE

(BUDGET FOR CONTRACT)



20

Earned Value Data Elements

S - Curve

M A N H O U R S / $

TIME

Actual Cost of Work Performed

(ACWP) , AC

Budget Cost of

Work Performed

(BCWP) , EV

Budgeted Cost of Work

Scheduled (BCWS) , PV

Estimate to Complete , (ETC)

Projected S-curve

Performance

Estimated Cost at Completion ,(EAC)

Budgeted at Completion , (BAC)Management Reserve ,(MR)

Variance at

Completion

(VAC)

Schedule

Variance(SV)

Cost

Variance

(CV)

T i m e N o

w

Time Variance NowForecast Time

Variance



21

5 Basic Guidelines

Organize the project team and the scope of work Using a work breakdown structure. Each task should have a single WBS

Number and organizational code.

Schedule the tasks in a logical manner

So that lower level schedule elements support other elements and the top

Level milestones. Allocate the total budget resources

To time-phased control accounts.

Establish objective means for measuring work

Accomplishment Budget should be earned in the same way that it was

Planned. Control the project

By analyzing cost and performance variances, assessing final costs,

Developing corrective actions and controlling changes to the integrated

Baseline.



22

Example To Analyze



23

Example To Analyzing

Input Data

PV EV AC BAC EAC

Hard Wear 170,000 140,000 200,000 400,000 ?

Soft Wear 175,000 150,000 230,000 210,000 ?Other 70,000 75,000 55,000 100,000 ?

Total 415,000 365,000 485,000 710,000 ?

We Will Take (Total Project) As Sample

Time Now Is (+ 4) Months.

Project Duration 8 Months



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Earned Value Data Tables

After E.V. - ResultsSCHEDULE MEASUREMENTS

SV = - 50,000

SV% = - 12.05 %

SPI = 0.88

COST MEASUREMENTS

CV = - 120,000

CV% = - 32.88 %

CPI = 0.75

COST / SCH. INDICES

CSPI = 0.66

CSPI = 0.776

TCPI = 1.53

OVERALL STATUS MEASUR.

% COMPLETED = 51.41 %% SCHEDULED = 58.45 %% SPENT = 68.31 %

TIME MEASUREMENTS

EAC (time) = 9. 09 M.PROJECT DELAY = 1.09 M. FORECAST MEASUREMENTS

ETC ($) VAC % ($) VAC ($)EAC ($)

461,667- 33.33%- 236,667- 946,667

460,000- 33.10%- 235,000- 945,000

522,727 **- 41.93% **- 297,727 **- 1,007,727 **

444,587 *- 30.93% *- 219,587 *- 929,587 *

BUDGET MEASUREMENTS

BUDGET REM.= 225,000WORK REM. = 345,000

* MINIMUM * * MAXIMUM



25


S Curve Before E.V. - Input Data

M A N H O U R S / $

TIME

Earned Value (EV) = 365,000

Planned Value (PV) = 415,000

Actual Cost ( AC ) = 485,000

Budgeted Cost At Completion (BAC) = 710,000

Time Now

4 Months8 Months

Variance at

Completion

(VAC) = ?

Cost Variance

(CV) = ?

Schedule Variance

(SV) = ?

Estimate to Complete (ETC) = ?

Estimate at completion (EAC) = ?

Forecasted

Time Variance

= ?

Estimated Project

Duration = ?



26


S Curve After E.V. - Results

M A N H O U R S / $

TIME

Earned Value (EV) = 365,000

Planned Value (PV) = 415,000

Actual Cost ( AC ) = 485,000

Budgeted Cost At Completion (BAC) = 710,000

Time Now

4 Months8 Months

Variance at

Completion

(VAC) =

- 219,587 To

- 297,727

Cost Variance

(CV) = - 120,000

Schedule Variance

(SV) = - 50,000

Estimate to Complete (ETC) = 444,587 To 522,727

Estimate at completion (EAC) = 929,587 To 1,007,727

Forecasted

Time Variance

= 1.09 Months

9.09 Months



27

Scenario Discussion



28

Scenario Discussion

DescriptionCPISPIScenarios

1

2

3

4

5

6

7

8

9

The Project is Ahead Schedule & Under Budget – Best CaseSPI > 1 CPI > 1

The Project is On Schedule & Under BudgetSPI = 1 CPI > 1

The Project is Behind Schedule & Under BudgetSPI < 1 CPI > 1

The Project is Ahead Schedule & On BudgetSPI > 1 CPI = 1

The Project is On Schedule & On Budget – Neutral CaseSPI = 1 CPI = 1

The Project is Behind Schedule & On BudgetSPI < 1 CPI = 1

The Project is Ahead Schedule & Over BudgetSPI > 1 CPI < 1

The Project is Behind Schedule & Over Budget – Worst CaseSPI < 1 CPI < 1

The Project is On Schedule & Over BudgetSPI = 1 CPI < 1



29

Recovery Strategies

ACTION

Reward Employees.

Increase OVER TIME.

Increase OVER TIME or PEOPLE.

Decrease OVER TIME.

Review and adjust assignments.

Adjust assignments; consider negotiation (schedule).

Decrease OVER TIME or people.

Adjust assignments; consider negotiation (funding).

Negotiation (funding, schedule, requirements). fire manager.

SCHEDULE

STATUS

GREEN

YELLOW

RED

GREEN

YELLOW

RED

GREEN

YELLOW

RED

COST

STATUS

GREEN

GREEN

GREEN

YELLOW

YELLOW

YELLOW

RED

RED

RED

13



30

Neutral Case…!!!

Be Careful.! You Are Walking on Tightrope.!

You May Fall Down Any Time..!!!

Worst Case…!!!

Things Not Going Well ..!!

Project In High Risk.!

Best Case…!!!

Every Body are Happy

1

2

3

3 Major ScenarioDiscussion

PROJECT

MANAGER



31

DATA Displaying



32

Data Presentation Before EV

Bar Chart – Before EV

TASK BUDGET JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC

12 12

1 24

8 12 16 12

2 48

14 14

3 28

4 12

5 36

11 11

6 22

∑ 170 12 20 12 16 26 14 16 16 8 8 11 11

CUM 0 12 32 44 60 86 100 116 132 140 148 159 170

PV 170 12 20 12 16 26 14 16 16 8 8 11 11

CUM 0 12 32 44 60 86 100 116 132 140 148 159 170

EV 0 0 0 0 0 0 0 0 0 0 0 0 0

CUM 0 0 0 0 0 0 0 0 0 0 0 0 0

AC 0 0 0 0 0 0 0 0 0 0 0 0 0

CUM 0 0 0 0 0 0 0 0 0 0 0 0 0

WORK PLAN FOR PROJECT



33

TASK BUDGET JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC

12 12

1 24

2 48

14 14

3 28

12

4 12

5 36

11 11

6 22

∑ 170 12 20 12 16 26 14 16 16 8 8 11 11

CUM 0 12 32 44 60 86 100 116 132 140 148 159 170

PV 60 12 20 12 16 26 14 16 16 8 8 11 11

CUM 0 12 32 44 60 86 100 116 132 140 148 159 170

EV 0 12 20 12 0 0 0 0 0 0 0 0 0

CUM 0 12 32 44 44 0 0 0 0 0 0 0 0

AC 0 12 22 12 8 0 0 0 0 0 0 0 0

CUM 0 12 34 46 54 0 0 0 0 0 0 0 0

WORK PLAN FOR PROJECT AND STATUS AS OF APRIL 30

T I M E N O W

Data Presentation After EV

Bar Chart – After EV



34

Data Presentation - Charts



35




36




37

Data Presentation -Table

WBS DESCRIPTION Pro j Ofcr %Comp %Spent CPI CV CV CV % VAC VAC

1 3600 PCC Zepka 28.99 34.09 0.850 -296.2 -17.62 -187.2

2 3200 COMMUNICATIONS Tideman 34.63 41.03 0.844 -130.8 -18.49 -87.0

3 G&A GEN & ADMIN 33.67 36.11 0.932 -45.2 -7.26 -36.8

4 2200 SYS ENGINEERING Price 85.04 94.35 0.901 -26.4 -10.95 0.0

5 3800 I & A Troop 35.40 37.08 0.955 -24.2 -4.75 -24.8

6 2100 PROJ MANAGEMENT Brown 45.70 48.51 0.942 -17.4 -6.16 -3.2

7 2300 FUNC I NTEGRA Pric e 71.62 75.23 0. 952 -17.4 -5.03 -30.8

8 5200 MANAGEMENT DATA Simmons 84.18 98.10 0.858 -13.2 -16.54 -16.0

9 3100 SENSORS Smith 20.87 21.49 0.971 -10.6 -2.94 -21.6

10 4000 SPARES Blair 17.87 18.90 0.945 -7.8 -5.78 -6.2

11 6200 SYSTEM TEST Hall 60.82 61.66 0.986 -5.6 -1.38 -2.0

12 5100 ENG DATA Nov ak 38.51 52.80 0.729 -4.6 -37.10 0.0

13 MR MGT RESERVE 0.00 0.00 0.0 439.2

14 UB UNDIST BUDGET 0.0 0.0

15 COM COST OF MONEY 0.0 0.0

16 3700 DATA DI SPLAY Troop 41.13 41.13 1. 000 0.0 0. 00 0.0

17 OV OVERHEAD 0.0 0.0

18 6100 TEST FACILITIES Smart 100.00 98.02 1.020 2.0 1. 98 0.0

19 3500 COMP PROGRAMS Pino 46.46 44.66 1.040 3.4 3. 87 -1.4

20 6300 PCC TEST Bond 23.13 22.64 1.021 4.2 2. 10 0.0

21 3400 ADPE Zepka 41.89 39.79 1.053 12.6 5.02 4.6

22 3300 AUX EQUI P Tideman 27.57 24.33 1. 133 78.2 11.73 8.4



38

Data Presentation - EXCEL

$5,000 $3,500 $4,000 $3,000 500 14.29% 1,000 25.00% 1.14 1.33

$5,000 $3,500 $4,000 $4,000 500 14.29% 0 0.00% 1.14 1.00

$5,000 $2,500 $3,000 $3,500 500 20.00% (500) -16.67% 1.20 0.86

$5,000 $4,000 $4,000 $3,500 0 0.00% 500 12.50% 1.00 1.14

$5,000 $3,500 $3,500 $3,500 0 0.00% 0 0.00% 1.00 1.00

$5,000 $4,000 $4,000 $4,500 0 0.00% (500) -12.50% 1.00 0.89

$5,000 $4,000 $3,500 $3,000 (500) -12.50% 500 14.29% 0.88 1.17

$5,000 $4,500 $4,000 $4,000 (5 00 ) -1 1.1 1% 0 0.00% 0.89 1.00

$5,000 $3,500 $3,000 $3,500 (500) -14.29% (500) -16.67% 0.86 0.86

70.00% 80.00% 60.00% 750 3,750 1,250 25.00% $2,000 $1,000 0.50

70.00% 80.00% 80.00% 1000 5,000 0 0.00% $1,000 $1,000 1.00

50.00% 60.00% 70.00% 2333 5,833 (833) -16.67% $1,500 $2,000 1.33

80.00% 80.00% 70.00% 875 4,375 625 12.50% $1,500 $1,000 0.67

70.00% 70.00% 60.00% 1500 5,000 0 0.00% $1,500 $1,500 1.00

80.00% 80.00% 90.00% 1125 5,625 (625) -12.50% $500 $1,000 2.0080.00% 70.00% 60.00% 1286 4,286 714 14.29% $2,000 $1,500 0.75

90.00% 80.00% 80.00% 1000 5,000 0 0.00% $1,000 $1,000 1.00

70.00% 60.00% 70.00% 2333 5,833 (833) -16.67% $1,500 $2,000 1.33

SVs = EV - PV EAC = BAC/CPI ETC = (BAC - EV)/CPI % COMPLETED = EV/BAC

SVs % = SV/PV EAC = AC + [(BAC - EV)/CPI] VAC% = VAC / BAC % SCHDULED = PV/BAC

SPIs = EV/PV EAC = AC + [( BAC - EV/((Evi + Evj + Evk)/(Aci + Acj + Ack))] VAC= BAC - EAC % SPENT = AC/BAC

CV = EV - AC EAC = AC + ETC = AC + [(BAC - EV)/CPI] Budget Remaining = BAC - AC (CUM ) SVt =PT-AT

CV% = CV/EV EAC = AC + [(BAC - EV)/ (CPI*SPI)] Work Remaining = BAC - EV (CUM) SPIt=PT/AT

CPI = EV/AC EAC = AC + [(BAC - EV)/(0.8CPI+0.2SPI)] TCPI = (BAC - EV) / (BAC - AC)

BAC PV EV AC

Schedul

performance

Index

Cost

performance

Index

Schedul

variance

Schedule

variance %

Cost

variance

Cost variance

%

% Spent

7

8

9

4

5

6

% Schduled

TASK N.

1

2

3

Work

Remained

To Complete

Performance

Index

TASK N.

1

Eastimate At

Complition

variance At

Complition

variance At

Complition

%

Budget

Remained

Estimate To

Complete

%

Completed

2

3

4

5

67

8

9



39

1.0

.9

1.1 “ G O O D

”

“ B A D ”

1.2

.8

COST PERFORMANCE INDEX (CPI)

SCHEDULE PERFORMANCE INDEX (SPI)

CPI

SPI

TIME

Performance Indices - Charts



40

Trend Analysis - Charts

D

ollars

In

T

housands

Cumulative VarianceMEGA HERZ ELEC & VEN F04695-86-C-0050 RDPR FPI

Element: 3200 Name: COMMUNICATIONS

COSTSCHEDVAC

1992

APR MAY JUN JUL AUG SEP OCT NOV DEC

1993

JAN

-300.0

-200.0

-100.0

0.0

100.0

1.0-2.03.0

1.0-18.0

3.0

1.0-17.0

3.0

-2.0-28.0

3.0

-13.0-37.0-10.0

2.0-52.0-10.0

-32.0-32.0-10.0

-101.0-207.0-87.0

-87.4-172.2-87.0

-130.8-203.2-87.0

Cum. charts show overall trend...are you getting better or worse?



41

DollarsInThousands

Current VarianceMEGA HERZ ELEC & VEN F04695-86-C-0050 RDPR FPI

Element: 3200 Name: COMMUNICATIONS

COSTSCHED

1992

APR MAY JUN JUL AUG SEP OCT NOV DEC

1993

JAN

-200.0

-100.0

0.0

100.0

1.0-2.0

0.0-16.0

0.01.0

-3.0-11.0

-11.0-9.0

15.0-15.0

-34.020.0

-69.0-175.0

13.634.8

-43.4-31.0

Current charts show the months where there

were significant performance problems.

Trend Analysis - Charts



42

Conclusion

EVM. Can be used to balance the triple project constraints

scope, schedule and cost.

EVM. Can provide feedback ,which is critical to the success of any project.

EVM. Is very useful tool for communication, risk management& decision making process.

EVM. Reflect how projects are managed on a short period basis.

EVM. Tells you Where it’s going right and where it’s going wrong ?

Where you really are ?

When to ask the tough questions ?



THANK YOU

earned value presentation -12022007

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