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Question - Need # Need Budgeting.

A travel guide & booking website IMMH Slide-9 EARNED VALUE ANALYSIS (EVA) Earned value is a measure of progress enables us to assess the percent of completeness of a project using quantitative analysis rather than rely on a gut feeling provides accurate and reliable readings of performance from as early as 15 percent into the project." MMH MMH Slide-10: COMPUTING EARNED VALUE The budgeted cost of work scheduled (BCWS) is determined for each work task represented in the schedule. BCWS is the effort planned for work task i. To determine progress at a given point along the project schedule, the value of BCWS is the sum of the BCWS; values for all work tasks that should have been completed by that point in time on the project schedule. The BCWS values for all work tasks are summed to derive the budget at completion, BAC. Hence, BAC = (BCWS) for all tasks k MMH IMMH Slide-11 COMPUTING EARNED VALUE Budgeted cost of work performed (BCWP) The value for BCWP is the sum of the BCWS values for all work tasks that have actually been completed by a point in time on the project schedule. the distinction between the BCWS and the BCWP is that the former represents the budget of the activities that were planned to be completed and the latter represents the budget of the activities that actually were completed. Given values for BCWS, BAC, and BCWP, important progress indicators can be computed: Schedule performance index, SPI = BCWP/BCWS SPI tells you how efficiently you are actually progressing compared to the planned progress. SPI is an indication of the efficiency with which the project is utilizing scheduled resources. Schedule variance, SV = BCWP - BCWS MMH IMMH Slide-12 COMPUTING EARNED VALUE Percent scheduled for completion = BCWS/BAC provides an indication of the percentage of work that should have been completed by time t. Percent complete = BCWP/BAC provides a quantitative indication of the percent of completeness of the project at a given point in time, t Actual cost of work performed, ACWP, is the sum of the effort actually expended on work tasks that have been completed by a point in time on the project schedule. It is then possible to compute Cost performance index, CPI = BCWP/ACWP The Cost Performance Index helps you analyze the efficiency of the cost utilized by the project. Cost variance, CV = BCWP - ACWP IMMH Slide-13 EVA EXERCISE - Assume you are a software project manager and you've been asked to compute earned value statistics for a small software project. The project has 56 planned work tasks that are estimated to require 582 person-days to complete. . At the time that you've been asked to do the earned value analysis, 12 tasks have been completed. However the project schedule indicates that 15 tasks should have been completed. The following scheduling data (in person-days) are avalable: IMMH Slide-14 EVA EXERCISE BAC = 582.00 SPI = BCWP/ BCWS = 126.5/ 156.5 = 0.808307 SV = BCWP - BCWS = 126.5 - 156.5 = -30 person-day Task Planned Effort Actual Effort 1 12.0 12.5 2 15.0 11.0 3 13.0 17.0 4 8.0 9.5 5 9.5 9.0 6 18.0 19.0 7 10.0 10.0 8 4.0 4.5 9 12.0 10.0 10 6.0 6.5 11 5.0 4.0 12 14.0 14.5 13 16.0 14 6.0 15 8.0 Given Total Task = 56; Effort Estimated=582 Person Day BCWP= 126.50 BCWS-156.50 ACWP-127.50 CPI = BCWP/ACWP = 126.5/127.5 = 0.99 CV = BCWP - ACWP = - person-day % schedule for completion = BCWS/ BAC = 156.5/582.00 = 26.89% [% of work scheduled to be done at this time] % complete = BCWP/ BAC = 126.5/ 582.00 = 21.74% [% of work completed at this time] MMH