An Introduction to EVM-

Transcription

1 An Introduction to EVM- A Primer to EV Methodology & Terminology October 2015 Bill Rodenfels, MBA, PMP 1

2 Training Objectives What is Earned Value? Why Use Earned Value? Building the Brick Wall Example Understanding Earned Value Methodology Understanding Earned Value Formulas Understanding Earned Value Terminology Earned Value Reading Graphs Earned Value in action Live Project 2

3 Earned Value What is it? Simply a Measuring Stick Earned VS Planned (Schedule) Earned VS Actuals (Cost) 3

4 The Project - Building a Brick Wall Technical: Build a brick wall 6 ft high, 2 ft wide, & 16 ft long Schedule: 4 Days Cost: 4 $250 / day each for 4 days $ 4,000 Material (Brick, Mortar, 2 Concrete Slabs) $ 6,000 Total Planned Costs $10,000

5 Building a Brick Wall Day 3 COB Where are we? Cost? Schedule? Budget Vs Actuals Budget $10,000 * ¾ = $7,500 Actuals Labor $ 1,000 * 3 = $3,000 Mat l $ 6,000 * ¾ = $4,500 $7,500

6 Building a Brick Wall Day 5 COB Complete Budget Vs Actuals Budget $10,000 = $10,000 Actuals Labor $ 1,000 * 5 = $5,000 Mat l $ 6,000 = $6,000 $11,000

7 Building a Brick Wall Planning Using Earned Value Cost Element Time in Days One Two Three Four Total Labor $1,000 $1,000 $1,000 $1,000 $4,000 Material $500 $2,000 $2,000 $1,500 $6,000 Total $1,500 $3,000 $3,000 $2,500 $10,000 Material: $6,000 / 6.0 ft First day 0.5 ft = $ 500 Second day 2.0 ft = $2,000 Third day 2.0 ft = $2,000 Fourth day 1.5 ft = $1,500 Total 6.0 ft = $6,000

8 Building a Brick Wall Planning Using Earned Value Cost Element Time in Days One Two Three Four Total Labor $1,000 $1,000 $1,000 $1,000 $4,000 Material $500 $2,000 $2,000 $1,500 $6,000 Total $1,500 $3,000 $3,000 $2,500 $10,000 Material: $6,000 / 6.0 ft First day 0.5 ft = $ 500 Second day 2.0 ft = $2,000 Third day 2.0 ft = $2,000 Fourth day 1.5 ft = $1,500 Total 6.0 ft = $6,000

9 Earned Value Methodology Building a Brick Wall Day 1 Plan Actual Scheduled effort $1,500 Scheduled effort $1,500 Effort Performed $ 950 Actual Cost of Effort $1,250 > ($550) Schedule > ($300) Cost

10 Building a Brick Wall Planning Using Earned Value Cost Element Time in Days One Two Three Four Total Labor $1,000 $1,000 $1,000 $1,000 $4,000 Material $500 $2,000 $2,000 $1,500 $6,000 Total $1,500 $3,000 $3,000 $2,500 $10,000 Material: $6,000 / 6.0 ft First day 0.5 ft = $ 500 Second day 2.0 ft = $2,000 Third day 2.0 ft = $2,000 Fourth day 1.5 ft = $1,500 Total 6.0 ft = $6,000

11 Earned Value Methodology Building a Brick Wall Day 2 Plan Actual Scheduled effort $4,500 Scheduled effort $4,500 Effort Performed $4,500 Actual Cost of Effort $4,500 > ($0) Schedule > ($0) Cost

12 Building a Brick Wall Planning Using Earned Value Cost Element Time in Days One Two Three Four Total Labor $1,000 $1,000 $1,000 $1,000 $4,000 Material $500 $2,000 $2,000 $1,500 $6,000 Total $1,500 $3,000 $3,000 $2,500 $10,000 Material: $6,000 / 6.0 ft First day 0.5 ft = $ 500 Second day 2.0 ft = $2,000 Third day 2.0 ft = $2,000 Fourth day 1.5 ft = $1,500 Total 6.0 ft = $6,000

13 Earned Value Methodology Building a Brick Wall Day 3 Plan Actual Scheduled effort $7,500 Scheduled effort $7,500 >($3,000) Sched Effort Performed $4,500 >($1,000) Cost Actual Cost of Effort $5,500

14 Building a Brick Wall Planning Using Earned Value Cost Element Time in Days One Two Three Four Total Labor $1,000 $1,000 $1,000 $1,000 $4,000 Material $500 $2,000 $2,000 $1,500 $6,000 Total $1,500 $3,000 $3,000 $2,500 $10,000 Material: $6,000 / 6.0 ft First day 0.5 ft = $ 500 Second day 2.0 ft = $2,000 Third day 2.0 ft = $2,000 Fourth day 1.5 ft = $1,500 Total 6.0 ft = $6,000

15 Earned Value Methodology Building a Brick Wall Day 4 Plan Actual Scheduled effort $10,000 Scheduled effort $10,000 >($2,500) Sched Effort Performed $7,500 >($1,000) Cost Actual Cost of Effort $8,500

16 Earned Value Methodology Building a Brick Wall Day 5 Plan $10,000 Actual $11,000 Scheduled effort $10,000 Effort Performed $10,000 Actual Cost of Effort $11,000 >($0) Sched >($1,000) Cost

17 Earned Value Methodology Simply a Measuring Stick Earned VS Planned (Schedule) Earned VS Actuals (Cost) Predictability & Forecasting 17

18 Building a Brick Wall Planning Using Earned Value Cost Element Time in Days One Two Three Four Total Labor $1,000 $1,000 $1,000 $1,000 $4,000 Material $500 $2,000 $2,000 $1,500 $6,000 Total $1,500 $3,000 $3,000 $2,500 $10,000 Planned Value (PV) Budget at Complete (BAC) Material: $6,000 / 6.0 ft First day 0.5 ft = $ 500 Second day 2.0 ft = $2,000 Third day 2.0 ft = $2,000 Fourth day 1.5 ft = $1,500 Total 6.0 ft = $6,000

19 Earned Value Methodology Building a Brick Wall Day 3 Plan Actual Planned Value (PV) Earned Value (EV) Actual Cost (AC) Scheduled effort $7,500 Effort Performed $4,500 Actual Cost of Effort $5,500 >($3,000) Sched >($1,000) Cost

20 Earned Value Methodology Building a Brick Wall Day 3 Plan Actual Schedule Variance (SV) = EV - PV Cost Variance (CV) = EV - AC Scheduled effort $7,500 Effort Performed $4,500 Actual Cost of Effort $5,500 >($3,000) Sched >($1,000) Cost

21 Earned Value Methodology Building a Brick Wall Day 3 Plan Actual Schedule Performance Index (SPI) = EV / PV Cost Performance Index (CPI) = EV / AC Scheduled effort $7,500 >4,500/7,500=0.6 Effort Performed $4,500 >4,500/5,500=0.8 Actual Cost of Effort $5,500

22 Earned Value Methodology Building a Brick Wall Day 4 = Quiz Plan Actual What is the: PV? EV? AC? SV? CV? BONUS What is the: SPI? CPI? Scheduled effort $10,000 Effort Performed $7,500 Actual Cost of Effort $8,500 >($2,500) Sched >($1,000) Cost

23 Earned Value Methodology - Terms Budget at Complete (BAC) = Total budget for total contract thru any given level Planned Value (PV) = Time-phased Budget Plan for work currently scheduled Earned Value (EV) = Value of completed work in terms of the work s assign budget Actual Cost (AC) = Cost actually incurred in accomplishing work performed Schedule Variance (SV) = difference between PV & EV [Pos. Fav, Neg. Unfavorable] Cost Variance (CV) = difference between AC & EV [Pos. Fav, Neg. Unfavorable] Schedule Performance Index (SPI) = Schedule Efficiency [>1.0 Fav, <1.0 Unfav] Cost Performance Index (CPI) = Cost Efficiency [>1.0 Fav, <1.0 Unfavorable]

24 Earned Value Graph Schedule Calculations >EV - PV = 90K 120K = (30K) SPI = EV / PV = 90K /120K = 0.75

25 Earned Value Graph Cost Calculations >EV - AC = 90K 60K = 30K CPI = EV / AC = 90K /60K = 1.3

26 Questions? 26