Q N U Earned Value Management They Say I have to Do It, But Why??? By Ursula Kuehn, PMP, EVP UQN and Associates

Q N U History of EVMS PERT/Cost on Minuteman Missile 1965 USAF created CSPCS (35 criteria) DOD issued C/SCSC (35 same criteria) 1996 DOD EVMS (NDIA initiative) (32 criteria) 1998 ANSI/EIA-Standard 748 (32 same criteria)

Q N U What Size of Project Requires EVMS? DoD requires on projects > $20M DoT requires on projects > $6M Dept. of Ed. requires on projects > $2M, with a lighter version for projects < $2M Do we see a trend?

Q N U 10 Easy Steps for EVMS on all Projects 1.Define the project scope via a WBS 2.Determine who will perform the work and what it might cost 3.Plan & schedule the defined work for the agreed upon scope 4.Determine points of management control 5.Authorize budgets for the baselined plan Adapted from Earned Value Management Project Management, Third Edition, Fleming and Koppelmen

Q N U 10 Easy Steps for EVMS on all Projects (continued) 6.Define metrics to measure performance of work within each control point 7.Record actual costs of the work 8.Measure control point performance and determine project performance 9.Forecast future performance 10.Manage changes to the agreed upon baseline

Q N U Step 1 Define the project scope via a Work Breakdown Structure

Q N U The WBS Ursula’s Pond HoleLinerWaterLivestockPlantsTest Pond Design Pond Project Management

Q N U Hole Move Earth Trees Plants Disposal Equipment Earth Removal Equipment Environmental Study Earth RemovalEarth Disposal Garden Take the Requirements Analysis to the Hole of the Pond

Q N U Water Water In Water Removal Water Circulates Take the Requirements Analysis to the Water of the Pond

Q N U Step 2 Determine who will perform the work and what it might cost

Q N U $ $71.35 $2.50$68.85 $93.45 $23.45$45.00$25.00 $50.00 $42.50 $2.50 $ $40.00 $7.50$107.95$25.00 $ $17.50$60.00$25.00 $ $30.00$90.00$ $35.00 $ $17.50$2.50$91.95$25.00 $ $109.35$64.35 $25.00 $41.50 $2.50$106.85$2.50$61.85$2.50$39.00 Pond 1234 Plants Livestock Water Rock Border Liner Pump Hole Inspect Pond Design Pond Design Hole Dig Hole Inspect Hole Design Liner Buy Liner Install Liner Fill Pond Test Water Design Water Bog Plants Floating Plants Oxygenating Plants Design Plants Install Oxy. Plants Buy Oxy. Plants Buy Bog Plants Install Bog Plants Buy Floating Plants Install Floating Plants Fish Snails Buy Fish Install Fish Install Snails Buy Snails Build Waterfall Buy Rock Install Border Buy Pump Install Pump Design Pump Test Waterfall $1,743.55

Q N U Step 3 Plan & schedule the defined work for the agreed upon scope

Q N U Planning and Scheduling the Defined Work END Work Package G Work Package I Work Package H Work Package E Work Package F Work Package B Work Package C Work Package D Work Package A

Q N U Step 4 Determine points of management control

Q N U $ $71.35 $2.50$68.85 $93.45 $23.45$45.00$25.00 $50.00 $42.50 $2.50 $ $40.00 $7.50$107.95$25.00 $ $17.50$60.00$25.00 $ $30.00$90.00$ $35.00 $ $17.50$2.50$91.95$25.00 $ $109.35$64.35 $25.00 $41.50 $2.50$106.85$2.50$61.85$2.50$39.00 Pond 1234 Plants Livestock Water Rock Border Liner Pump Hole Inspect Pond Design Pond Design Hole Dig Hole Inspect Hole Design Liner Buy Liner Install Liner Fill Pond Test Water Design Water Bog Plants Floating Plants Oxygenating Plants Design Plants Install Oxy. Plants Buy Oxy. Plants Buy Bog Plants Install Bog Plants Buy Floating Plants Install Floating Plants Fish Snails Buy Fish Install Fish Install Snails Buy Snails Build Waterfall Buy Rock Install Border Buy Pump Install Pump Design Pump Test Waterfall $1,743.55

Q N U Step 5 Authorize budgets for the baselined plan

Q N U Allocating the Budget Work Package G $3, END Work Package I $2,000 Work Package H $3,000 Work Package E $7,000 Work Package F $5,000 Work Package B $8,000 Work Package C $4,000 Work Package D $9,000 Work Package A $6,000

Q N U Baseline the Plan

Q N U Step 6 Define metrics to measure performance of work within each control point

Q N U How to Measure Progress Effort/(Effort + Remaining) Physical % Complete Weighted Milestones or Inchstones 50/50 Rule, 20/80 Rule, 0/100 Rule Others, all used to determine a % Complete

Q N U Step 7 Record actual costs of the work

Q N U Collecting Actual Cost (AC) Timesheets Invoices Other Expenses

Q N U Step 8 Measure performance and determine project performance

Q N U The Planned Value (PV) END Task I $2,000 Task H $3,000 Task E $7,000 Task F $5,000 Task G $3,000 Task B $8,000 Task C $4,000 Task D $9,000 Task A $6,000

Q N U The PV Continued TaskTotal Task BudgetPlanned Value (PV) As of Day 10 A$6, B$8,000.00$4, C D$9,000.00$4, Project$47,000.00$18,000.00

Q N U The PV Continued Data Date

Q N U Earned Value (EV)

Q N U The EV Continued TaskTotal Task BudgetPlanned Value (PV) As of Day 10 %Comp%Comp Earned Value (EV) As of Day 10 A$6, %$6, B$8,000.00$4, %$2, C$4, %$3, D$9,000.00$4, %$4, Project$47,000.00$18,000.00$15,500.00

Q N U EV Analysis

Q N U Variances PositiveNegative SVAhead of scheduleBehind schedule CVUnder budgetOver budget

Q N U Cost Variance CV

Q N U Performance Indexes

Q N U EVA Examples PV = $45,000 EV = $35,000 AC = $40,000 SV = -$10,000 CV = -$5,000 SPI = 0.78 CPI = 0.86 PV = $145,000 EV = $135,000 AC = $140,000 SV = -$10,000 CV = -$5,000 SPI = 0.93 CPI = 0.96

Q N U Pond 1234 Plants Livestock Water Rock Border Liner Pump Hole Inspect Pond Design Pond Design Hole Dig Hole Inspect Hole Design Liner Buy Liner Install Liner Fill Pond Test Water Design Water Bog Plants Floating Plants Oxygenating Plants Design Plants Install Oxy. Plants Buy Oxy. Plants Buy Bog Plants Install Bog Plants Buy Floating Plants Install Floating Plants Fish Snails Buy Fish Install Fish Install Snails Buy Snails Build Waterfall Buy Rock Install Border Buy Pump Install Pump Design Pump Test Waterfall

Q N U Basing Your Stoplight on Your CPI

Q N U Step 9 Forecast future performance

Q N U The Estimate At Completion (EAC) Forecasts possible project outcome based on past performance –Calculating the EAC with just the CPI –Calculating the EAC with both the CPI and SPI Note: EAC always has the caveat “…if things do not change…”

Q N U Other Forecasting Formulas The estimate to complete (ETC) The variance at completion (VAC) The to-complete performance index (TCPI)

Q N U Step 10 Manage changes to the agreed upon baseline

Q N U The Change Control Process Establish a change control board (CCB) Require the use of change request forms Keep a change control log For each approved change, a new PMB is established

Q N U Conclusion Earned Value Management Is Project Management