PM592 The Analysis of the Earned Value of Project
Your project has four activities. Below is the current status of each activity.
Activity A was to have cost $150,000 when complete. Its costs so far are $45,000. It is 35% complete. The activity has completed 5 weeks of a planned 15-week schedule. Activity B is at the end of week 2 of a planned 4-week effort. It is 45% complete. It was to cost $100,000 when finished. Its costs to date are $50,000.
Activity C is finished. It finished 2 weeks late. It cost $100,000. And it was planned to have cost $110,000.
Activity D is beginning its fourth of a planned 6-week schedule. It has cost $200,000 so far. It was estimated to cost $450,000 when finished. It is approximately 55% complete. Using these data, calculate the following.
- What are the PV, EV, and AC for the project?
BAC = $810,000
PV for project = $(35%*150,000) + (45%*100,000) + (100,000) + (55%*450,000) = $52,500 + 45,000 + 100,000 + 247,500 = $445,000.
EV = (52%*810,000) = $421,200
AC = $395,000
- What are the SV, CV, SPI, and CPI for the project?
SV = EV – PV = -$23,800 (negative variance means project is behind schedule)
CV = EV – AC = $26,200
SPI = EV / PV = 0.95
CPI = EV / AC = 1.07
- Assess the project performance to date. Do you get to have the celebration?
The project is behind schedule and hence, time is to be adjusted in order to get to have the celebration.
5-2 Earned Value Calculation
Your project has four activities. Below is the current status of each activity.
Activity A was to have cost $250,000 when complete. Its costs so far are $165,000. It is 50% complete. The activity has completed 7 weeks of a planned 15-week schedule.
Activity B is at the end of week 2 of a planned 4-week effort. It is 65% complete. It was to cost $190,000 when finished. Its costs to date are $150,000.
Activity C is finished. It finished 2 weeks late. It cost $200,000 and it was planned to have cost $250,000. Activity D is at the end of its fourth of a planned 6-week schedule. It has cost $350,000 so far. It was estimated to cost $500,000 when finished. It is approximately 55% complete.
Using these data, calculate the following.
- Calculate the CV, SV, CPI, and SPI for each activity and the total project
Project A
BAC = $250,000
PV for project = 47%*$250,000 = $117,500
EV = (50%*250,000) = $125,000
AC = $165,000
SV = EV – PV = $7500
CV = EV – AC = -$40,000
SPI = EV / PV = 1.06
CPI = EV / AC = 0.76
Project B
BAC = $190,000
PV = 50%*190,000 = $95,000
EV = 65%*190,000 = $123,500
AC = $150,000
SV = $28,500
CV = –$26,500
SPI = 1.3
CPI = 0.82
Project C
BAC = $250,000
PV = 120%*250,000 = $300,000
EV = 100%*250,000 = $250,000
AC = $200,000
SV = –$50,000
CV = $50,000
SPI = 0.83
CPI = 1.25
Project D
BAC = $500,000
PV = 67%*500,000 = $335,000
EV = 55%*500,000 = $275,000
AC = $350,000
SV = –$60,000
CV = –$75,000
SPI = 0.82
CPI = 0.79
Total for Project:
SV = -$74,000
CV = -$91,500
SPI = 1.0025
CPI = 0.905
- What is your assessment of the project at this time?
The project is behind the planned budget and experiencing extra expenses. Also, the project is behind schedule.
Answer:
The following presentation has been developed for forming the analysis of the earned value analysis of the project. The two project cases and their progress values had been considered for the project. The calculation of planned and earned values, actual cost, and cost & schedule variances had been done in this assignment. The project activities A, B, C, and D have been evaluated for Schedule Performance Index and Cost Performance Index for the project. Th
e following outcomes has been seen for the projects,
|
5.1 | ||||||
|
Activity A |
Budget (in dollars) |
Work |
Time (in weeks) |
BAC |
PV | |
|
Expected |
$150,000.00 |
100% |
15 |
$150,000.00 |
$52,500.00 | |
|
Actual |
$45,000.00 |
35% |
5 | |||
|
Activity B |
Budget (in dollars) |
Work |
Time (in weeks) | |||
|
Expected |
$100,000.00 |
100% |
4 |
$100,000.00 |
$45,000.00 | |
|
Actual |
$50,000.00 |
45% |
2 | |||
|
Activity C |
Budget (in dollars) |
Work |
Time (in weeks) | |||
|
Expected |
$110,000.00 |
100% |
1 |
$110,000.00 |
$100,000.00 | |
|
Actual |
$100,000.00 |
100% |
3 | |||
|
Activity D |
Budget (in dollars) |
Work |
Time (in weeks) | |||
|
Expected |
$450,000.00 |
100% |
6 |
$450,000.00 |
$247,500.00 | |
|
Actual |
$200,000.00 |
55% |
3 | |||
|
Total |
BAC |
$810,000.00 | ||||
|
PV |
$445,000.00 | |||||
|
EV |
$421,200.00 | |||||
|
AC |
$395,000.00 | |||||
|
SV |
-$23,800.00 | |||||
|
CV |
$26,200.00 | |||||
|
SPI |
0.95 | |||||
|
CPI |
1.07 |
|
5.2 | ||||||||
|
Activity A |
Budget (in dollars) |
Work |
Time (in weeks) |
BAC |
PV |
EV |
AC | |
|
Expected |
$250,000.00 |
47% |
15 |
$250,000.00 |
$117,500.00 |
$125,000.00 |
$165,000.00 | |
|
Actual |
$165,000.00 |
50% |
7 |
CV |
SV |
CPI |
SPI | |
|
-$40,000.00 |
$7,500.00 |
0.76 |
1.06 | |||||
|
Activity B |
Budget (in dollars) |
Work |
Time (in weeks) |
BAC |
PV |
EV |
AC | |
|
Expected |
$190,000.00 |
50% |
4 |
$190,000.00 |
$95,000.00 |
$123,500.00 |
$150,000.00 | |
|
Actual |
$150,000.00 |
65% |
2 |
CV |
SV |
CPI |
SPI | |
|
-$26,500.00 |
$28,500.00 |
0.82 |
1.3 | |||||
|
Activity C |
Budget (in dollars) |
Work |
Time (in weeks) |
BAC |
PV |
EV |
AC | |
|
Expected |
$250,000.00 |
120% |
1 |
$250,000.00 |
$300,000.00 |
$250,000.00 |
$200,000.00 | |
|
Actual |
$200,000.00 |
100% |
3 |
CV |
SV |
CPI |
SPI | |
|
$50,000.00 |
-$50,000.00 |
1.25 |
0.83 | |||||
|
Activity D |
Budget (in dollars) |
Work |
Time (in weeks) |
BAC |
PV |
EV |
AC | |
|
Expected |
$500,000.00 |
67% |
6 |
$500,000.00 |
$335,000.00 |
$275,000.00 |
$350,000.00 | |
|
Actual |
$350,000.00 |
55% |
4 |
CV |
SV |
CPI |
SPI | |
|
Total |
BAC |
$1,190,000.00 |
-$75,000.00 |
-$60,000.00 |
0.79 |
0.82 | ||
|
PV |
$876,000.00 | |||||||
|
EV |
$773,500.00 | |||||||
|
AC |
$865,000.00 | |||||||
|
SV |
-$74,000.00 | |||||||
|
CV |
-$91,500.00 | |||||||
|
SPI |
1.0045 | |||||||
|
CPI |
0.9042 |
It is evident from the tables that,
Calculation of 5.1 was based on the expected and actual cost of the project activities (A, B, C, and D)
Expected budget for activity A was $150,000, activity B was $100,000, activity C was $110,000, and activity D was $450,000
Total BAC for the project was $810,000
The SV, CV, SPI, and CPI has been calculated with the help of calculating the PV, EV, and AC
SV value has been negative for the project and CV value for the project is positive
The negative value has shown that project is behind schedule and the positive value has shown that the project is cost effective
Calculation of 5.2 was based on the expected and actual cost of the project activities (A, B, C, and D)
Expected budget for activity A was $250,000, activity B was $190,000, activity C was $250,000, and activity D was $500,000
Total BAC for the project was $1,910,000
The SV, CV, SPI, and CPI has been calculated with the help of calculating the PV, EV, and AC
SV value has been negative for the project and CV value for the project is also negative
The negative value has shown that project is behind schedule and the negative value has shown that the project is over budget
The two projects had been facing issues for successful completion namely,
The problems of project was the delay in execution of the project activities
The delay in project can result in forming the issues for the project execution
The activities of the project had been both delayed and over budgeted
The project activities had been lagging in terms of expected work completion
The exhaustion of the resources is another major factor that had resulted in negative cost variance for the project
Some recommendations for the project
The delay of the project can be sorted out by using more resources
The project is ahead in terms of cost and hence, the extra saved resources can be utilized for gaining the time lapsed
The utilization of the effective schedule planner would help in overcoming the delay
Practically project can be completed in the estimated time duration with minimum cost variation from the calculated value by using project management principles of change management and control management process
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