Earned Schedule application to Project Management
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1 Earned Schedule application to Project Management Walt Lipke PMI - Oklahoma City [email protected] $$ The ES idea is to determine the time at which the EV accrued should have occurred. PV cum = Planned Value EV cum Earned Value Actual Time Earned Schedule Time Periods
2 Abstract A review of Earned Schedule, focusing on project management control areas for which the methodology provides an advance in practice. 2 Lipke 2011 EVM Europe Copyright 2011
3 Overview Background Review of ES Metric Indicators & Terminology Forecasting & Prediction Project Control Schedule Adherence Rework Application Aids Supplemental Remarks Summary 3 Lipke 2011 EVM Europe Copyright 2011
4 Background We need to maintain our attention on schedule delivery. Data tells us that since July 2003, real cost increase in projects accounted for less than 3 percent of the total cost growth. Therefore, our problem is not cost, it is SCHEDULE. - Dr. Steve Gumley, CEO Defence Materiel Organization (Australia) Quote taken from DMO Bulletin, July 2006, Issue 61, page 4 Lipke 2011 EVM Europe Copyright 2011
5 Background 5 Lipke 2011 EVM Europe Copyright 2011
6 ES Metric The ES idea is to determine the time at which the EV accrued should have occurred. Actual Time $$ PV cum = Planned Value EV cum Earned Value Earned Schedule Time Periods 6 Lipke 2011 EVM Europe Copyright 2011
7 ES Metric ES measure requires the PMB and EV accrued Determined from formula, ES = C + I where C is number of periodic time units of the PMB for which EV PV C and I = [(EV PV C ) / (PV C+1 PV C )] 1 period At completion, just as EV = BAC, ES = PD where PD = Planned Duration 7 Lipke 2011 EVM Europe Copyright 2011
![C and I = [(EV PV C ) / (PV C+1 PV C )] 1 period At completion, just as EV =](/docs-images/44/17014368/images/page_7.jpg "BAC, ES = PD where PD = Planned Duration 7 Lipke 2011 EVM Europe Copyright")
8 ES Indicators The ES measure leads to reliable indicators for the entire duration of the project SV(t) = ES AT SPI(t) = ES / AT cumulative SV(t) n = (ES n ES n-1 ) 1 SPI(t) n = (ES n ES n-1 ) / 1 periodic where AT is the number of status periods 8 Lipke 2011 EVM Europe Copyright 2011
9 ES Terminology 9 Lipke 2011 EVM Europe Copyright 2011
10 Forecasting EVM forecast of final cost: IEAC = BAC / CPI ES forecast of project duration: IEAC(t) = PD / SPI(t) Goodness of forecast has been verified by Application Statistical testing Simulation Useful to compare forecast from Critical Path EV data to project forecast 10 Lipke 2011 EVM Europe Copyright 2011
11 Forecasting Range of possible outcomes confidence limits 40 Project #1 - Schedule Months IEAC(t)H IEAC(t)L IEAC(t) Final Duration Percent Complete 11 Lipke 2011 EVM Europe Copyright 2011
12 Prediction Calculation of TSPI provides information concerning whether to attempt corrective action or negotiate a change with the customer 12 Lipke 2011 EVM Europe Copyright 2011
13 Project Control 13 Using EVM & ES leads to general strategies
14 Project Control 14 Improved project recovery tactics
15 Project Control 15 Better project management decisions
16 Schedule Adherence ES facilitates measuring how well project execution follows the plan 16
17 Schedule Adherence 17 Independent from schedule efficiency (SPI(t)) Measured as ratio of EV conforming to the PV which should have been earned (P-Factor) Allows analysis which identifies tasks having impediments or constraints Identifies tasks which are likely to have future rework and enhances forecasting Leads to Schedule Adherence Index and improved control Facilitates calculation of induced rework
18 SA - Analysis Example BAC 6 ES 18 AT Task PV PV@ES EV@AT EV - PV Total PV I/C or R I/C I/C R I/C R R
19 SA - Enhanced Forecasting Reverse Data Example Data IEAC(te) PD IEAC(t) IEAC(te) Good Prediction Area Good Prediction Area Fraction Complete 19 IEAC(t) 20 Predicted Duration Predicted Duration 20 PD Fraction Complete
20 Rework Schedule Adherence Index SAI = R / (BAC EV) where R = f(p, EV, BAC) SAI is useful for detecting trends thus a management tool for gauging actions taken 20 SAI increasing with EV SA worsening SAI decreasing with EV SA improving Allows for calculation of out of sequence EV Facilitates forecast of project rework cost
21 Rework 21 Ability to determine amount of out of sequence EV and forecast rework cost heightens management attention to schedule execution Increases ability of oversight functions to identify EV gaming Improved schedule adherence hypothesized to improve both cost and schedule performance efficiencies
22 Rework - Real Example 22 BAC $2.5 million, P = CPI 1.05, SPI(t) 0.98 EV(r) $80K, Rework Forecast $40K
23 Application Aids 23 Calculation of ES, indicators, and forecast available from ES website (es calculator page) and several EVM tools Small Projects (Down Time & Stop Work) ES website Range of possible outcomes (confidence limits) ES website Schedule Adherence (P-Factor) ES website, Project Flight Deck, and ProTrack Out of Sequence EV & Rework ES website
24 Summary 24 Managing schedule may be more difficult than cost and has more repercussions ES is derived from the PMB and EV accrued ES makes possible reliable schedule performance indicators, forecasting, prediction Amplifies ability to control project using EVM & ES Facilitates identifying process logjams and assess & minimize rework Application aids are available and coming
25 Supplemental Remarks 25 Data for analysis comes from EVM no new data is required Provides top down approach to assessing schedule performance Equally usable for re-planned projects, and small projects having stop work and down-time conditions
26 Supplemental Remarks ES methodology is growing 26 ES website is receiving 40K hits per month Project management and EVM books now include ES Included in university coursework & research Evidence of use is global Usage is occurring in several industries Included in PMI EVM Practice Standard (Oct 2011)
27 Supplemental Remarks 27 ES has had its share of detractors and proponents, as well British philosopher, John Stuart Mill, once made this observation that new ideas pass through three phases of denial: First They are wrong Second They are against religion Third They are old news, trivial, common sense, and we all would have thought of them if we had had the time, money, and interest
28 References 28 Earned Schedule Application to Small Projects, PM World Today, April 2011 (Vol. XIII, Issue IV) Schedule Adherence and Rework, The Measurable News, 2011 Issue 1: 9-14 Earned Schedule, Rayleigh, NC, Lulu Publishing 2009 Earned Schedule Website:
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