09 PROJECT PERFORMANCE MGT

8/8/2019 09 PROJECT PERFORMANCE MGT

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Performance ManagementPerformance Management

Session 9Session 9


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The Project CycleThe Project Cycle


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The Most Basic SystemThe Most Basic System


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Monitoring Time PerformanceMonitoring Time Performance


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This Is What It Looks Like In MS ProjectThis Is What It Looks Like In MS Project


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PerformancePerformance

ManagementManagement

y Looks only at time

y Does not take into account cost performance

y While it implies work completed it is based on

time spent this not verified actual complete

y What is the value of the work completed?

CommentComment



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Monitoring Budget PerformanceMonitoring Budget Performance

Example you budget 100 hours to assemble bridge

pillars and at the end of the period you have achieved the 100 hours

Budget Actual Variance

100 hours @ R 300 R 100 hours @

R 300

R 0


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Ho do you stay on track?Ho do you stay on track?

What is a Project Monitoring System

Examples of Progress Reports

What is the Project Control Process and why is it useful?

How do I Monitor Time Performance

The shortcomings of monitoring Systems

Earned Value Management

Integrated Cost/Schedule System

Project Baselines


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Time PerformanceTime Performance

Does not connect duration to resource

utilization


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Cost PerformanceCost Performance

Systems that measure only cost

variances do not identify resource and

project cost problems associated with

falling behind or progressing ahead of

schedule


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Project Baselines


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EVAEVA-- What do you need?What do you need?


utilization


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EVAEVA-- What do you need?What do you need?


utilization


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What is Earned ValueAnalysis (EVA)?What is Earned ValueAnalysis (EVA)?


utilization

A project performancemeasurement technique that

integrates scope, time, and cost

data.


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What is Earned ValueAnalysis (EVA)?What is Earned ValueAnalysis (EVA)?


utilization

A project performance measurement technique

that integrates scope, time, and cost data.

Given a baseline (original plan plus approvedchanges), you can determine how well the

project is meeting its goals.

You must enter actual information

periodically to use EVA.


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The Planned Value (PV)The Planned Value (PV) -- This is that portion of the approved total costThis is that portion of the approved total costestimate planned to be spent on an activity during a given periodestimate planned to be spent on an activity during a given period

1000

900

800

700

600

500

400

300

200

100

1 2 3 4 5 6 7 8 9 10

PVPV


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The Planned Value (PV)The Planned Value (PV) -- This is that portion of the approved total costThis is that portion of the approved total costestimate planned to be spent on an activity during a given periodestimate planned to be spent on an activity during a given period

1000

900

800

700

600

500

400

300

200

100

1 2 3 4 5 6 7 8 9 10

PVPV


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Actual Cost (AC)Actual Cost (AC) --TheThe total coststotal costs incurred in finishing work on anincurred in finishing work on anactivity during a given periodactivity during a given period

1000

900

800

700

600

500

400

300

200

100

1 2 3 4 5 6 7 8 9 10

PVPVACAC


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Earned Value (EV)Earned Value (EV) -- An estimate of the value of the physical workAn estimate of the value of the physical workactually completedactually completed

1000

900

800

700

600

500

400

300

200

100

1 2 3 4 5 6 7 8 9 10

PVPVACAC EVEV


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Time NowTime Now An importantconceptAn importantconcept

1000

900

800

700

600

500

400

300

200

100

1 2 3 4 5 6 7 8 9 10

PVPVACAC EVEV


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Based on this you can calculate:Based on this you can calculate:

CV Cost Variance

SV Schedule Variance

CPICost Performance

Index

SPISchedule Performance

Index


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Earned ValueEarned Value

Determine value of work

completed attime now

Or percentage times budget

atcompletion (EV=

PCxBAC), where PC is

percentage complete


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Cost VarianceCost Variance

Earned Value (EV) minus

Actual Cost (AC) shows the

difference between theestimated cost of an activity

and the actual cost of that

activity

EV-AC=CV


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Cost Performance IndexCost Performance Index

CPI = EV/AC

If the CPI < 1 then the project

is spending more than it isgetting in terms of value

Corrective action needs to be

taken else the project will

make a loss or will run out offunds


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Schedule VarianceSchedule Variance

Earned Value (EV) minus

Planned Value (PV) shows the

difference between theschedule completion and

actual completion to date.

EV-PV=SV


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Schedule Performance IndexSchedule Performance Index

SPI = EV/PV

If the SPI < 1 then the projectis behind schedule

Corrective action needs to be

taken to bring up to schedule


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Estimate at Completion (Estimate at Completion (EACEAC))

EAC = AC/PC (where PCis Percentage Complete

atTime Now


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Estimate to Complete (ETC)Estimate to Complete (ETC)

ETC = EAC-AC


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ExampleExample

WP BAC PV PC EV AC SV CV EAC ETC

1 9000 9000 100 9000 11000 0 -2000 11000 0

2 2000 2000 100 2000 2000 0 0 2000 0

3 10000 6000 50 5000 7000 -1000 -2000 14000 7000

4 6000 6000 67 3996 4000 -2004 -4 6006 2006

5 4000 4000 50 2000 2500 -2000 -500 5000 2500

6 6000 0 0 0 0 0 0 6000 6000

7 8000 0 0 0 0 0 0 8000 8000

8 4000 2000 50 2000 1500 0 500 3000 1500

9 8000 4000 25 2000 3000 -2000 -1000 12000 9000

10 4000 4000 100 4000 3500 0 500 3500 0

29996 34500 -7004 -4504 70506 36006

ExampleExample


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ExampleExample

WP BAC PV PC EV AC SV CV EAC ETC

1 9000 9000 100 9000 11000 0 -2000 11000 0

2 2000 2000 100 2000 2000 0 0 2000 0

3 10000 6000 50 5000 7000 -1000 -2000 14000 7000

4 6000 6000 67 3996 4000 -2004 -4 6006 2006

5 4000 4000 50 2000 2500 -2000 -500 5000 2500

6 6000 0 0 0 0 0 0 6000 6000

7 8000 0 0 0 0 0 0 8000 8000

8 4000 2000 50 2000 1500 0 500 3000 1500

9 8000 4000 25 2000 3000 -2000 -1000 12000 9000

10 4000 4000 100 4000 3500 0 500 3500 0

29996 34500 -7004 -4504 70506 36006

ExampleExample


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Project Baselines


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Dwight EisenhowerDwight Eisenhower

Plans are useless planning is indispensible


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When plans changeWhen plans change

EVA allows experts in the field tochange original baseline durationsand costs because new information

tells them the original estimates arenotaccurate

EVA uses actual costs-to-date plus anefficiency index to project final costsin large projects where the originalbudget is unreliable


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An Integrated SystemAn Integrated System

System

Planning

Control

WBS

Network

Diagram

Schedule Bar

Chart

Monitorand

Review

Corrective

Action


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An Integrated SystemAn Integrated System


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Project Baselines


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Baseli e isananchor oint for easuring erfor anceBaseline isananchor oint for easuring erfor ance


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To change the baselineTo change the baseline change control processchange control process


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09 PROJECT PERFORMANCE MGT

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