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Earned Value Management

Earned Value Management. Cost Spread/Example. Spreading Techniques. How do we “earn value” ??? 0/100% Critical to finish 50/50% Want to recognize start, but finish is still important % complete Most accurate, but requires admin staff Balanced Level of Effort Repetitive tasks

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Earned Value Management

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  1. Earned Value Management Cost Spread/Example

  2. SpreadingTechniques • How do we “earn value” ??? • 0/100% • Critical to finish • 50/50% • Want to recognize start, but finish is still important • % complete • Most accurate, but requires admin staff • Balanced Level of Effort • Repetitive tasks • Directed Milestone • Use if critical events represent value

  3. Example Task Cost Start End WP1 10 1 3 WP2 10 3 7 WP3 10 3 4 WP5 20 6 9 WP5 10 1 10

  4. 1 2 3 4 5 6 7 8 9 10 WP1 WP2 WP3 WP4 Monthly BCWS Cumulative BCWS WP5 Example BCWS 50/50 (10) 0/100 (10) 50/50 (10) % (20) LOE (10)

  5. 1 2 3 4 5 6 7 8 9 10 WP1 WP2 WP3 WP4 Monthly BCWS Cumulative BCWS WP5 Example BCWS 5 3 2 50/50 (10) 2 4 1 1 2 0/100 (10) 2 8 50/50 (10) 4 5 % (20) 6 5 1 1 1 1 1 1 1 1 1 1 LOE (10) 6 4 7 13 2 6 9 6 6 1 6 10 17 30 32 38 47 53 59 60

  6. 1 2 3 4 5 6 7 8 9 10 WP1 WP2 WP3 WP4 Monthly ACWP Cumulative ACWP WP5 Example ACWP 50/50 (16) 0/100 (11) 50/50 (10) % (22) LOE (10) WP4 was completed in 20% week 1, 50% week 2, and 30% week 3

  7. 1 2 3 4 5 6 7 8 9 10 WP1 WP2 WP3 WP4 Monthly ACWP Cumulative ACWP WP5 Example ACWP 0 7 9 50/50 (16) 0 3 8 0 0 0/100 (11) 4 6 50/50 (10) 6 0 % (22) 6 10 1 1 1 1 1 1 1 1 1 1 LOE (10) 1 8 14 10 9 7 7 11 1 1 1 9 23 33 42 49 56 67 68 69

  8. 1 2 3 4 5 6 7 8 9 10 WP1 WP2 WP3 WP4 Monthly BCWP Cumulative BCWP WP5 Example BCWP 50/50 (10) 0/100 (10) 50/50 (10) % (20) LOE (10)

  9. 1 2 3 4 5 6 7 8 9 10 WP1 WP2 WP3 WP4 Monthly BCWP Cumulative BCWP WP5 Example BCWP Did I start? Did I finish? What % did I do * total $ 0 5 5 50/50 (10) 0 0 10 0 0 0/100 (10) 5 5 50/50 (10) 4 0 % (20) 10 6 0 1 1 0 1 1 1 1 0 1 LOE (10) 0 6 11 5 11 5 11 7 0 1 0 6 17 22 33 38 49 56 56 57 Did I actually do the LOE scheduled (or meet the milestone)? WP4 was completed in 20% week 1, 50% week 2, and 30% week 3

  10. Week 4 • Schedule Variance SV = BCWP – BCWS SV = 22 – 30 = -8 • On/Off plan in dollars (>0 is ahead, 0 is on target, <0 is behind) • Schedule Performance Index SPI = BCWP/BCWS SPI = 22/30 = .73 • On/off plan as a ratio (>1 is ahead, 1 is on target, <1 is behind) • Cost Variance CV = BCWP – ACWP CV = 22 -33 = -11 • Over/under running (>0 is underrun, 0 is on target, <0 is overrun) • Cost Performance Index CPI = BCWP/ACWP CPI = 22/33 =.666 • Return on actual costs (>1 is under, 1 is on target, <1 is over)

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