Project Management in PracticeOutline:Overview:Schedule Variance & Cost/Spend Variance:Earned Value Chart 1Earned Value Chart 2Earned Value Chart 3Earned Value Chart 4Earned Value Chart 5Earned Value Chart 6Earned Value AnalysisTask Earned ValueTask Earned Value - ExamplesTask Planned Value/Cost, PVTask Planned Value/Cost, PV ExamplesVariances / IndiciesExampleExample AON Diagram:Gantt Chart:Excel Given & Solution:MSP Notes:Slide 22Slide 23Slide 24Slide 25Slide 26Slide 27Slide 28Project Control:Scope Creep & Change Control:Quality Management Processes The Big PictureSome Common Project Quality Tools/Data Collection:Check SheetsSlide 34Slide 35Pareto ChartCause-and-effect diagramSlide 38Slide 39Control ChartSlide 41Schedule VarianceCost VarianceProject Management in Practice 7-1Monitoring & Controlling the ProjectInitiateInitiatePlanPlanExecuteExecuteMonitorAndControlMonitorAndControlCloseCloseOutline:7-2 Overview Earned value analysis Project control / tracking techniques Scope creep and change control Quality / collection and presentation of project data.Homework: 25, 26, 27, 28#27 end of 6th week = MSP date 2/10/01 (end of 6th week), do not compute critical ratio use the default 5-day work week use start date 1/1/01#28 Repeat problem 27 using MSPOverview:7-3Project PlanProject PlanMonitoringMonitoringControlControlSchedule Variance &Cost/Spend Variance:7-4PVACEVPVACEVEarned Value Chart 17-5TimeNowDollarsSchedulevarianceCostvarianceCost schedule plan(baseline)ACWPBCWPBCWSActual costValue completed (Earned Value)PerformanceCostSched.badbadEarned Value Chart 27-6TimeNowDollarsBCWSbaselineACWPBCWP=EVPerformanceCostSched.badgoodEarned Value Chart 37-7TimeNowDollarsBCWSbaselineACWPBCWP = EVPerformanceCostSched.goodgoodEarned Value Chart 47-8TimeNowDollarsBCWSbaselineACWPBCWP = EVPerformanceCostSched.badbadEarned Value Chart 57-9TimeNowDollarsBCWSbaselineACWPBCWP = EVPerformanceCostSched.goodbadEarned Value Chart 67-10TimeNowDollarsBCWSbaselineACWPBCWP=EVPerformanceCostSched.goodgoodEarned Value AnalysisEarned Value Analysis compares the current project status with the original (baseline) plan.It computes several performance metrics for individual activities and for the entire project.It focuses on cost and schedule performanceIt’s a useful tool/input for project control.Popular project management software computes these metrics.Project EV is calculated by summing up the individual task EV’s.7-11Task Earned Value7-12Expert estimated value of work performed to date, if available.There are a variety of rules (see page 248).Work off budget / schedule values, if available.EV = BAC X (portion of work completed)EV = BAC X (actual work completed / total amount of work)Task Earned Value - Examples7-13Expert believes value of work performed to date is $120,000. Task is complete, expected to cost $1,500 (budgeted), best estimate is the task is 2/3 finished.Day 50 of 100 day, $100,000 budgeted task, manager estimated value of work performed is $40,000.Project X is at the end of its 5th week. Activity D is 30% complete. Activity D budgeted cost is $1000.D53 83Task Planned Value/Cost, PV7-14Budgeted / scheduled amount, to date.Determined from the baseline plan or budget.Works off budgeted cost numbers.BCWS.Planned cost of work on a task or project up to a given point in time.PV = BAC X (portion of time that has elapsed)PV = BAC X (time passed / total time scheduled)Task Planned Value/Cost, PVExamples7-15• Activity was scheduled to have spent $100,000 at this point in the plan / budget.• Work on a project task was expected to cost $1500 and the workers were originally scheduled to have the task compete today.• Work on a project task is uniformly distributed, total task budget is $2000. The task is scheduled to last 8 weeks, the current time is end of week 5. Task is scheduled to begin end of week 2.Variances / Indicies7-16Cost/Spending Varianceearned value (EV) – actual cost (AC)Schedule Varianceearned value (EV) – planned cost (PV)CPI (Cost Performance Index)earned value (EV)/actual cost (AC)SPI (Schedule Performance Index)earned value (EV)/planned cost (PV)Example7-17Day 75 of a 75 day task, Task “data conversion of payables for external vendors”.Task planned cost total on day 75, $100,000 ($100,000 = PV).Actual spend to date, $90,000.Best estimate 50% complete.Earned Value (EV) =0.50 X $100,000 = $50,000.Cost/spending variance = EV – AC = $50,000 - $90,000 = - $40,000.Schedule variance = EV – PV = $50,000 - $100,000 = - $50,000.CPI = EV/AC = 50/90 = 0.56 Cost Performance Index SPI = EV/PV = 50/100 = 0.50 Schedule Performance Index (we are worse on schedule than cost) ETC = (BAC – EV) / CPI = (100,000 – 50,000) / .56 = $90,000.EAC = ETC + AC = $90,000 + $90,000 = $180,000.ETC = Estimated cost To CompletionEAC = Estimated total cost At CompletionBAC = Budget At Completion AC = Actual Cost to dateExampleAON Diagram:7-18ActivityDuration (days)Preda 8 b 6 ac 4 4d 9 ce 11 af 3 bg 1 d,e,facbefdg0 819 204 1314 178 198 140 4Current date = end of day 18Gantt Chart:7-19Task eTask e = 11 days, current date is end of day 18At end of day 18, we are scheduled/planned to be 10/11 complete.This is used in the PV computation.Excel Given & Solution:7-204 4 4 4 4 4 4% of plannedActivityDuration (days)Budget ($) Actual ($) % Complete ES EFfinish on 2/1/01a 8 250 300 100.00% 0 8 1b 6 100 100 100.00% 8 14 1c 4 300 200 100.00% 0 4 1d 9 500 600 100.00% 4 13 1e 11 400 450 50.00% 8 19 10/11f 3 350 375 20.00% 14 17 1g 1 450 0 0.00% 19 20 0BAC $2,350.00 AC $2,025.00 EV $1,420.00 PV (budget) $1,863.64 4 4Current Date 2/1/01 For activity e notice the duration is 11 daysBeg of day 17 at the end of day 18, 1/11 is scheduled to remain (since the task EF is 19)End of day 18 10/11 of the task is scheduled/planned complete.4 4Project Start 1/15/01Cost/Spend var $(605.00)Schd var $(443.64)CPI 0.70 more has been spent than the baseline planSPI 0.76 given what has been spent, less progresss has been made than should have been4 4ETC $1,326.23 (BAC-EV) / CPIEAC $3,351.23 ETC + ACBreak task into 11 (its duration)parts. End of day 18 we are 10/11 finished.noticeMSP Notes:7-21Double ClickCurrent Date LineCurrent Date LineBeg of day 2/1End of day 2/1Used in MSPCalculationsPut end of day date here for MSP calculations7-22Enter activity names, predecessors,