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Schedule Variance status does indicate the dollar value difference between work that is ahead or behind the plan and reflects a given measurement method.
Schedule Variance status does not address impact of work sequence.
The formula utilized to express schedule variance is project earned value minus the project planned value as of the date of examination.
(SV = EV – PV) If the variance is equal to 0, the project is on schedule.
If a negative variance is determined, the project is behind schedule and if the variance is positive the project is ahead of schedule.
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Oftentimes the term “earned value” is defined as the “budgeted cost of worked performed” or BCWP.
This budgeted cost of work performed measure enables the project manager to compute performance indices or burn rates for cost and schedule performance, which provides...
Potential Causes of Favorable Cost Performance:
Project Management Institute. (2004) A Guide to the Project Management Body of Knowledge (PMBOK® Guide). (Third ed.) Newtown Square, PA: Project Management Institute
Project Management Institute. (2005) Practice standard for earned value management (PMI Global Standard) (2005 ed.) Newtown S...
Another analysis that can be done by using EVMS is that of Performance or establishing the project’s burn rate.
Two examination of performance are available to the project manager, Schedule Performance Index (SPI) and Cost Performance Index (CPI).
Actual Cost (AC), also called actual expenditures, is the cost incurred for executing work on a project. This figure tells you what you have spent and, as with Planned Value, can be looked at in terms of cumulative and current.
To report the accomplishments of the project, you must apply Earned Value (EV) to the figures and calculations in the project. EV is the quantification of the “worth” of the work done to date.
In other words, EV tells you, in physical terms, what the project has accompl...
The cost variance is defined as the “difference between earned value and actual costs. (CV = EV – AC)” (PMI, 2004, p. 357)
Sometimes this formula is expressed as the difference between budgeted cost of work performed and actual cost work performed.
The CPI is defined by PMI’s PMBOK® Guide as a measure of cost efficiency on a project.
It is the ratio of earned value (EV) to actual costs (AC). The CPI is equal to the earned value divided by the actual costs, CPI = EV – AC.
Assuming your CPI efficiency remains the ...
Originally published in part of 2006 PMI Global Congress Proceedings – Seattle WA
Planned Value describes how far along project work is supposed to be at any given point in the project schedule and cost estimate.
PV, also known as Budget Cost of Work Scheduled (BCWS), can be defined as:
Anticipating future progress requires determining when the project will be completed and how much it will cost to complete it.
The Estimate at Completion (EAC) is the actual cost to date plus an objective estimate of costs for remaining authorized work.
The objective in preparing an E...
Earned Value Analysis (EVA) is a method that allows the project manager to measure the amount of work actually performed on a project beyond the basic review of cost and schedule reports.
EVA provides a method that permits the project to be measured by prog...
The PM will be provided with financial information from accounting that will expressed the actual cost incurred on the project's work is performed, then the PM will seek information from the team that will state the budgeted cost of work performed on the project, or earned value.
Earned Value Management Systems allow the project manager to answer the following three questions, as they relate to the project:
Where have we been?
Where are we now?
Where are we going?
In Earned Value Management, unlike in traditional manageme...
The SPI is defined by PMI’s PMBOK® Guide as “a measure of schedule efficiency on a project.
It is the ratio of earned value (EV) to planned value (PV). The SPI is equal to earned value divided by planned value, SPI = EV/PV.
An SPI equal to or greater than one indi...
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