Basics of earned value management
This presentation is the property of its rightful owner.
Sponsored Links
1 / 71

BASICS OF EARNED VALUE MANAGEMENT PowerPoint PPT Presentation


  • 63 Views
  • Uploaded on
  • Presentation posted in: General

BASICS OF EARNED VALUE MANAGEMENT. National Contract Management Association Colorado Springs Colorado June 19, 2008. Earned Value Management (EVM) Training Objectives. Understand basic concepts What EVM is and basic terms How to evaluate performance What does it all mean?

Download Presentation

BASICS OF EARNED VALUE MANAGEMENT

An Image/Link below is provided (as is) to download presentation

Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author.While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server.


- - - - - - - - - - - - - - - - - - - - - - - - - - E N D - - - - - - - - - - - - - - - - - - - - - - - - - -

Presentation Transcript


Basics of earned value management

BASICS OFEARNED VALUE MANAGEMENT

National Contract Management Association

Colorado Springs Colorado

June 19, 2008


Earned value management evm training objectives

Earned Value Management (EVM) Training Objectives

  • Understand basic concepts

    • What EVM is and basic terms

  • How to evaluate performance

    • What does it all mean?

  • How to manage using Earned Value

    • Now that we know what it is and what it means, what do we do with it?


Earned value management systems measure progress

Earned Value Management Systems measure progress

Progress = Movement Forward

to measure progress,

there must be a standard

against which the forward

movement may be

compared

EVMS establishes a baseline

to measure progress


Evm can provide answers to the following questions

EVM can provide answers to the following questions:

  • How much have we spent?

  • How much did we get for our money?

  • How much more will be have to spend to complete the tasks we wanted to accomplish?

  • How much longer will it take?

  • How efficiently is the work being done?

  • What has happened? (Why are we off schedule/cost?)

  • What is happening? (What are the impacts?)

  • What is going to happen? (What are we doing to fix it?)


Why use earned value management systems

Why use Earned Value Management Systems?

“The Bottom Line”

  • EVM can focus program management attention on critical issues and risks during the “project” life cycle

  • How are you doing, and how do you know how you are doing?

    • Early problem identification

  • Completion Estimates

    • How far along are you? (64%, 50%, >40%)

    • What is your productivity/efficiency?

    • Work remaining


Earned value management is not

Earned Value ManagementIs Not:

  • Guarantee of profit

  • Restricted to projects for the production of a products – EVM can be used in service contracts

  • Solution for a poorly written statement of work

  • Magic Bullet


Five basic elements

Five Basic Elements


Basics of earned value management

5 Basic Performance Data Questions & Answers

QUESTIONANSWERACRONYM

How much work shouldBudgeted Cost for BCWS

be done?Work Scheduled

How much work is done?Budgeted Cost forBCWP

Work Performed

How much did the is doneActual Cost ofACWP

work cost?Work Performed

What was the total jobBudget at CompletionBAC

supposed to cost?

What do we now expect theEstimate at CompletionEAC

total job to cost?


What do we measure progress against and why

What do we measure progress against? and Why?

  • Performance measurement baseline

    • Budget that is spread over . . .

    • Time, to accomplish the scope of

    • Work, against which progress can be measured

  • Earned Value is key concept

    • how much progress did I make against my original plan?

    • expressed in dollars or hours

    • Why? – early warning

baseline

$

earned value

time


Why do we need early warning

Why do we needEarly Warning?

Small course corrections are easier when made early…

… If you wait until you reach the Iceberg, its too late!!!


Terms and definitions associated with evm

Terms and Definitions associated with EVM:

  • It starts with the Work Breakdown Structure (WBS)

    • Based on the WBS a total budget is assigned

    • Work packages are developed and priced

    • A process to measure the results of those work packages is put into place

    • Work packages are tracked for both the dollars and time spent

  • The result of this effort is developing a Budget at completion (BAC)


Work breakdown structure

Work Breakdown Structure

Systematic approach to ensuring all program work is recognized and defined into a viable work plan – should include labor and materials for complete picture

1.0 Project –

New Marketing Campaign

for Dog Food

First Level

1.1 Printed

Media

1.2 Electronic

Media

1.3 Radio

Second Level

1.1.1

Magazines

1.1.2

Newspaper

inserts

1.3.1

Local

Spots

1.3.2

Regional

Spots

Third

Level

1.2.1

Website

1.2.2

TV


Organizational breakdown structure

Organizational Breakdown Structure

Identifies the functions and/or people that will do the work

New Marketing Campaign

for Dog Food -

assign to the Western Division

Admin Asst

Chen

Chuck’s

Design

Team

Regional

Media

Support

Centralized

National

Support

Sally

For message

And theme

Juan for

Customer

interface

Stan

In

Accounting

Ray

Budget

John for

Computer

Graphics

Josh

Audio

Beverly

in

National

Accounts

Tanya Print


Responsibility matrix

Responsibility Matrix

Assigns WBS work to OBS labor

1.1

1.2

WBS

OBS

1.1.1

1.1.2

1.2.1

Admin

Asst

- - - - - - - - - - - - - - - - - - - - - - - - - -

graphics

audio

- - - - - - - - - - - - - - -

design

- - - - - - - - - - - - - - - - - - - - - - - -

accounting

budget

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -

- - - - - - - - - - - - - - - - - - - - - - - - -

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -


Contract budget base

AUTHORIZED,

UNPRICED

CONTRACT

PRICE

PROFITS AND

FEES

CONTRACT

BUDGET BASE

WITHHELD

FOR

UNKNOWNS

PERFORMANCE

MEASUREMENT

BASELINE

MANAGEMENT

RESERVE

DISTRIBUTED

(control accountS)

WITHHELD FOR

KNOWN EFFORT

UNDISTRIBUTED

BUDGET

CONTRACT BUDGETBASE


Organization

CONTRACT

BUDGET LEDGER

MASTER SCHEDULE

GENERAL WORK

AUTHORIZATION

Control Account

WBS # ______________ ORG # ______________

TASK DESCRIPTION________________________

SCHEDULE _______________________________

TOTAL BUDGET ________________

WORK PACKAGE

WP # ________ ORG # _________

DESCRIPTION ________________

______________________________

SCHEDULE _________________

BUDGET ___________________

ORGANIZATION

WBS ELEMENT

ORGANIZATION

WORK AUTHORIZATION

SCHEDULE

BUDGET

COST ACCUMULATION


The control account a key management control point

The Control AccountA Key Management Control Point

  • Specific functional responsibility

  • Specific WBS responsibility

  • Work planning and assignment

  • Performance measurement

  • Cost collection

  • Variance analysis

  • Corrective action

  • Basis of data summarization


Contract budget base1

AUTHORIZED,

UNPRICED

CONTRACT

PRICE

PROFITS AND

FEES

CONTRACT

BUDGET BASE

WITHHELD

FOR

UNKNOWNS

PERFORMANCE

MEASUREMENT

BASELINE

MANAGEMENT

RESERVE

DISTRIBUTED

(control accountS)

WITHHELD FOR

KNOWN EFFORT

UNDISTRIBUTED

BUDGET

CONTRACT BUDGETBASE


Performance measurement data elements

PERFORMANCE MEASUREMENTDATA ELEMENTS

UNDISTRIBUTED BUDGET (UB)

Budget applicable to contract effort which has not yet been identified to CWBS elements at or below the lowest level of reporting to the Government.

KEY: Only used for the effort associated

with the contractual change.


Performance measurement data elements1

PERFORMANCE MEASUREMENTDATA ELEMENTS

MANAGEMENT RESERVE (MR)

An amount of the total allocated budget withheld for management control purposes rather than designated for the accomplishment of a specific task or set of tasks.

KEY: There is no scope of work associated

with management reserve budget.


Basics of earned value management

PLANNING AND BUDGETING

ESTABLISH THE BASELINE - AN ITERATIVE, 3-STEP PROCESS

1. DEFINE THE WORK

CONTRACT BUDGET BASE

MR

2. SCHEDULE THE WORK

$

PM BASELINE

3. ALLOCATE BUDGETS

100

40

60

15

25

30

30

TIME


Work budgeted and earned

Work Budgeted and Earned

  • The value of the budgeted work is called: Budgeted Cost of Work Scheduled (BCWS)

  • The value of work earned is called: Budgeted Cost of Work Performed (BCWP)

    • BCWP is also called Earned Value (EV)


Basics of earned value management

5 Basic Performance Data Questions & Answers

QUESTIONANSWERACRONYM

How much work shouldBudgeted Cost for BCWS

be done?Work Scheduled

How much work is done?Budgeted Cost forBCWP

Work Performed

How much did the is doneActual Cost ofACWP

work cost?Work Performed

What was the total jobBudget at CompletionBAC

supposed to cost?

What do we now expect theEstimate at CompletionEAC

total job to cost?


Basics of earned value management

Budgeted Cost of Work Scheduled

(BCWS)

Total Budget = $5,000

to be spent over 5 months

I plan to lay 1 section

of track each month at an

estimated cost of $1,000.

BCWS each month = $1,000

Total BCWS = $5,000

Month 1

BCWS = $1,000

Month 2

BCWS = $1,000

Month 3

BCWS = $1,000

Month 4

BCWS = $1,000

Month 5

BCWS = $1,000

sum of all BCWS = performance baseline


Basics of earned value management

5 Basic Performance Data Questions & Answers

QUESTIONANSWERACRONYM

How much work shouldBudgeted Cost for BCWS

be done?Work Scheduled

How much work is done?Budgeted Cost forBCWP

Work Performed

How much did the is doneActual Cost ofACWP

work cost?Work Performed

What was the total jobBudget at CompletionBAC

supposed to cost?

What do we now expect theEstimate at CompletionEAC

total job to cost?


Budgeted cost of work performed bcwp aka earned value

Budgeted Cost of Work Performed(BCWP)aka. Earned Value

Track 1

We’re at the end of February, Track 1 is complete and track 2 is ½ done.

BCWS = $1,000

Track 2

BCWS = $1,000

Value of work performed = $1,500

50% done


Schedule variance

Schedule Variance

BC WS

BC WP

of the work I scheduled to have done,

how much did I budget for it to cost?

BUDGET BASED

of the work I actually performed,

how much did I budget for it to cost?

SCHEDULE VARIANCE is the difference between work scheduled and work performed (expressed in terms of budget dollars)

formula: SV $ = BCWP - BCWS

example: SV = BCWP - BCWS = $1,500 - $2,000

SV= -$500 (negative = behind schedule)


Schedule variance1

Schedule Variance

5,000

BCWS

“the baseline”

sv

$

BCWP

“earned value”

TIME


Basics of earned value management

5 Basic Performance Data Questions & Answers

QUESTIONANSWERACRONYM

How much work shouldBudgeted Cost for BCWS

be done?Work Scheduled

How much work is done?Budgeted Cost forBCWP

Work Performed

How much did the is doneActual Cost ofACWP

work cost?Work Performed

What was the total jobBudget at CompletionBAC

supposed to cost?

What do we now expect theEstimate at CompletionEAC

total job to cost?


Actual cost of work performed acwp

Actual Cost of Work Performed (ACWP)

  • Value is earned as the work is completed and gauged against the schedule proposed for the work

  • When all work is completed it will have earned its full budgeted value but the actual cost of that work may be different that the amount budgeted… this is referred to as Actual Cost of Work Performed (ACWP)


Performance measurement data elements2

PERFORMANCE MEASUREMENTDATA ELEMENTS

ACTUAL COST FOR WORK PERFORMED (ACWP)

The costs actually incurred and recorded in accomplishing

  • the work performed (BCWP) within a given time period

    • Labor

    • Material (Subcontractor/vendor)

    • Other, computer costs, etc.

    • Indirect Costs


Actual cost of work performed acwp1

Actual Cost of Work Performed(ACWP)

Track 1 Cost = $1,500!

Track 2 Cost = $750 cost to date

Total Cost to Date = $2,250


Cost variance

Cost Variance

BC WP

AC WP

of the work I actually performed,

how much did I budget for it to cost?

PERFORMANCE BASED

of the work I actually performed,

how much did it actually cost?

COST VARIANCE is the difference between budgeted cost

and actual cost

formula: CV $ = BCWP - ACWP

example: CV = BCWP - ACWP = $1,500 - $2,250

CV= -$750 (negative = cost overrun)


Cost variance1

Cost Variance

5,000

ACWP

“actual cost”

cv

$

BCWP

“earned value”

TIME


Variance summary

Variance Summary

  • The difference between the BCWP and the ACWP is called a cost variance

  • The difference between the BCWP and BCWS is called schedule varianceand is provided in terms of dollars


Basics of earned value management

5 Basic Performance Data Questions & Answers

QUESTIONANSWERACRONYM

How much work shouldBudgeted Cost for BCWS

be done?Work Scheduled

How much work is done?Budgeted Cost forBCWP

Work Performed

How much did the is doneActual Cost ofACWP

work cost?Work Performed

What was the total jobBudget at CompletionBAC

supposed to cost?

What do we now expect theEstimate at CompletionEAC

total job to cost?


Budget at completion bac

Budget at Completion (BAC)

BAC

$

sum of all BCWS =

$

$

$

$

$

$

$

time

  • when all work has been phased, cumulative BCWS = BAC


Estimate at completion eac

Estimate at Completion(EAC)

Just a few little glitches…. We should be able to do the complete job….ack…

let’s see, for about $7,000


Basics of earned value management

Variance at Completion (VAC)

B ACwhat the total job is supposed

to cost

E ACwhat the total job is expected

to cost

VARIANCE AT COMPLETIONis the difference between what the total job is supposed to cost and what the total job is now expected to cost.

FORMULA: VAC = BAC - EAC

Example: VAC = $5,000 - $7,000

VAC = - $2,000 (negative = overrun)


Earned value management evm training objectives1

Earned Value Management (EVM) Training Objectives

  • Understand basic concepts

    • What EVM is and basic terms

  • How to evaluate performance

    • What does it all mean?

  • How to manage using Earned Value

    • Now that we know what it is and what it means, what do we do with it?


Formulas

Cost variance

BCWP – ACWP

Schedule variance

BCWP – BCWS

Cost variance in percentage

BCWP – ACWP x 100

BCWP

Schedule variance in percent

BCWP – BCWS x 100

BCWS

Formulas

Negative variance = cost overrun or behind schedule

Positive variance = cost underrun or ahead of schedule


Trend analysis

Trend Analysis

Cost Performance Index (CPI) measure of cost efficiency

CPI = Value of Work Completed(BCWP)

Cost of Work Completed (ACWP)

Schedule Performance Index (SPI) measure of schedule efficiency

SPI = Value of Work Completed(BCWP) Value of Work Planned (BCWS)

Closer to “1” the better

Less than 1 = overrun (CPI); behind schedule (SPI)

Greater than 1 = underrun (CPI); ahead of schedule (SPI)


Basics of earned value management

Performance Efficiencies

  • DO I THINK THE CONTRACTOR WILL COME IN ON BUDGET?

  • COST PERFORMANCE INDEX:

  • CPI = cost efficiency for work performed to date

  • (The value of work accomplished for each dollar spent)

  • SCHEDULE PERFORMANCE INDEX:

  • SPI = schedule efficiency with which work has been accomplished

  • (The rate at which work is being accomplished)

WORK

= ACCOMPLISHED

ACTUALS

WORK

BCWPACCOMPLISHED$1500

= ACWP = ACTUAL = $2250 = .67

COST

WORK

= ACCOMPLISHED

WORK

SCHEDULED

WORK

BCWPACCOMPLISHED$1500

= BCWS = WORK = $2000 = .75

SCHEDULED


Exercises

EXERCISES

  • Attendees – Go to your Exercise Packet


Evm exercise

EVM Exercise

BAC = 500

BCWS = 300

BCWP = 320

ACWP = 330

  • What is the cost variance?

  • What is the Schedule variance?

  • What is the Cost Performance Index?

  • What is the Schedule Performance Index?

  • How would you describe this project?


Solution

Solution

BAC = 500

BCWS = 300

BCWP = 320

ACWP = 330

  • What is the cost variance?

    • BCWP – ACWP = -10

  • What is the Schedule variance?

    • BCWP – BCWS = +20


  • Solution1

    Solution

    BAC = 500

    BCWS = 300

    BCWP = 320

    ACWP = 330

    • What is the Cost Performance Index?

      BCWP/ACWP = .97

    • What is the Schedule Performance Index?

      BCWP/BCWS = 1.07


    Solution2

    Solution

    Cost Variance = -10

    Schedule Variance = + 20

    CPI = .97

    SPI = 1.07

    • How would you describe this project?

      Over budget, ahead of schedule


    Example of performance analysis by wbs element

    Example Of Performance Analysis By WBS Element.

    The table that follows presents key information for several elements of the contract WBS

    What can it tell us?


    Graphical depictions of evm

    Graphical Depictions of EVM


    Performance measurement data elements3

    Contract

    Complete

    PERFORMANCE MEASUREMENTDATA ELEMENTS

    BUDGET

    $

    BCWS

    TIME


    Performance measurement data elements4

    Contract

    Complete

    PERFORMANCE MEASUREMENTDATA ELEMENTS

    BUDGET

    $

    BCWS

    CV

    ACWP

    BCWP

    TIME


    Bcwp allows isolation of schedule and cost variances

    BCWP Allows Isolation ofSchedule and Cost Variances

    5,000

    BCWS

    ACWP

    cv

    $

    sv

    BCWP

    TIME

    schedule variance = BCWP - BCWS = negative number

    cost variance = BCWP - ACWP = negative number

    behind schedule,

    over cost


    Budget at complete bac estimate at complete eac and variance at complete vac

    Budget at Complete (BAC), Estimate at Complete (EAC)and Variance at Complete (VAC)

    Schedule

    Delay

    BAC = Sum of BCWS

    (Planned cost of all work)

    BAC = $5,000

    EAC

    VAC

    BAC

    ETC

    EAC(kr)* = ACWP plus estimated to complete (ETC)

    (Actual cost to date plus expected cost to finish all work)

    EAC = $7,000

    PM BASELINE

    $

    VAC = BAC-EAC

    VAC = $5,000-$7,000

    VAC = -$2,000

    TIME

    * EAC(kr) = Contractor EAC


    Performance measurement data elements5

    Contract

    Complete

    PERFORMANCE MEASUREMENTDATA ELEMENTS

    BUDGET

    VAC

    ESTIMATE

    $

    SV

    BCWS

    CV

    ACWP

    BCWP

    TIME


    Basics of earned value management

    Trend Analysis Using Performance Indexes

    CPI

    1.0

    SPI

    Performance

    SPI

    1.0

    CPI

    Time

    Performance

    1.0

    SPI

    Time

    CPI

    Performance

    Time


    Basics of earned value management

    Trend Analysis Using Performance Indexes

    CPI

    1.0

    SPI

    Performance

    CPI

    1.0

    SPI

    Time

    Performance

    1.0

    SPI

    Time

    CPI

    Performance

    Time


    Basics of earned value management

    Earned Value Management

    Trend Analysis

    CPI

    1.0

    SPI

    Performance

    CPI

    1.0

    Time

    SPI

    Performance

    1.0

    SPI

    Time

    CPI

    Performance

    Time


    Sample combined numerical and graphical display

    Sample combined numerical and graphical display


    Earned value management evm training objectives2

    Earned Value Management (EVM) Training Objectives

    • Understand basic concepts

      • What EVM is and basic terms

    • How to evaluate performance

      • What does it all mean?

    • How to manage using Earned Value

      • Now that we know what it is and what it means, what do we do with it?


    Ways of earning value

    Ways of Earning Value

    • Earned Value techniques

      • Discrete

        • physical, tangible end product

      • Apportioned

        • discrete, dependent on another discrete work package

        • example: quality assurance

        • planned as historical estimating factor (e.g., 7%)

      • Level of Effort

        • no tangible end product

        • basis of measurement: time

        • when clock starts ticking, you automatically accumulate earned value

        • no schedule variance

        • example: management personnel

    • Should be a quantitative and discrete way to measure the work

    • May tie in with success criteria or technical measure

      • e.g., successful completion of a specific test, QP’s


    Contractor reports

    Contractor Reports

    • Cost Performance Report (CPR)

      • Format 1: cost and schedule progress by WBS

        (specified reporting level usually at level 3)

      • Format 2: cost and schedule progress by organization

      • Format 3: changes to performance measurement baseline

      • Format 4: manpower forecast

      • Format 5: variance analysis

    current and cum data


    Basics of earned value management

    Format 1 Block Descriptions

    Block #

    1. Contractor Information - Tells you name and address of contractor

    2. Contract Information - Tells name, number, type and Share ratio of contract

    3. Program Information- Name and Phase of program

    4. Report Period - Beginning and end dates of the report data

    5. Contract Data - Includes quantities, prices, fee’s, profit, and ceilings

    6. Estimated cost - Estimated cost at completion and variance

    7. Contractor Representative - Name, Title, Signature, and Date signed

    8. Broken in to sections a through g and in 4 groups of data

    - Current period - BCWP, BCWS, ACWP, Cost and Schedule Variances

    - Cumulative to date - BCWP, BCWS, ACWP, Cost and Schedule Variances

    - Reprogramming Adjustments - Cost Variances and Budget

    - At Completion - Budgeted, Estimated, and Variance

    8a WBS cost data

    8bCost of money

    8cGeneral and administrative cost

    8dUndistributed money

    8eSubtotal (Total without Management Reserve)

    8fManagement Reserve

    8g Total

    9aVariance adjustments (Cumulative to Date)

    9bTotal Contract Variance (Cumulative to Date and At Completion)


    Format 2 organizational categories

    Format 2: Organizational Categories

    • Used when contractor organizational structure does not mirror the WBS structure

    • Provides CPR data in an organizational format


    Format 3 baseline

    Format 3: Baseline

    • Used to track changes to the performance baseline and future authorized work

      • Identifies all changes to authorized work during the reporting period

      • Identifies distribution of any undistributed budget during the reporting period


    Format 4 staffing

    Format 4: Staffing

    • Provides planned staffing

      • Current Period

      • Cumulative to the end of Current Period

      • Staffing forecast's to end of authorized work

      • At Completion

    • Broken down into organizational categories


    Format 5 explanation and problem analysis

    Format 5: Explanation and Problem Analysis

    • Also called Variance Analysis Report (VAR)

    • Provides explanations, impact, and corrective actions of WBS that exceed thresholds


    Variance explanations

    Variance Explanations

    • Format 5 variance analysis should address:

      • separate discussion of CV, SV (current and cum) and VAC

      • clear description of reason for variance

      • quantity variances (e.g., price vs. usage)

      • be specific, not general

      • corrective action

      • technical, schedule, and cost impacts

      • impact to estimate at completion

    A big hammer for

    a big variance!


    Basics of earned value management

    Contract Price

    Profit / Fees

    TAB

    NCC

    CBB

    OTB

    AUW

    OVERRUN

    EAC

    PMB

    Management Reserve

    TAB

    Management Reserve

    Undistributed

    Budget

    Control

    Accounts

    Summary Level

    Planning Packages

    BAC

    PMB

    Work Packages

    Planning Packages

    Schedule Variance

    TERMINOLOGY

    NCCNegotiated Contract CostContract price less profit / fee(s)

    AUWAuthorized Unpriced WorkWork contractually approved, but not yet negotiated / definitized

    CBBContract Budget BaseSum of NCC and AUW

    OTBOver Target BaselineSum of CBB and recognized overrun

    TABTotal Allocated BudgetSum of all budgets for work on contract = NCC, CBB, or OTB

    BACBudget At CompletionTotal budget for total contract thru any given level

    PMBPerformance Measurement BaselineContract time-phased budget plan

    MRManagement ReserveBudget withheld by Ktr PM for unknowns / risk management

    UBUndistributed BudgetBroadly defined activities not yet distributed to CAs

    CAControl AccountLowest CWBS element assigned to a single focalpoint to plan & controlscope / schedule / budget

    WPWork PackageNear-term, detail-planned activities within a CA

    PPPlanning PackageFar-term CA activities not yet defined into WPs

    BCWSBudgeted Cost for Work ScheduledValue of work planned to be accomplished= PLANNED VALUE

    BCWPBudgeted Cost for Work PerformedValue of work accomplished = EARNED VALUE

    ACWPActual Cost of Work PerformedCost of work accomplished = ACTUAL COST

    EACEstimate At CompletionEstimate of total cost for total contract thru any given level;

    may be generated by Ktr, PMO, DCMA, etc. = EACKtr / PMO / DCMA

    LRELatest Revised EstimateKtr’s EAC or EACKtr

    SLPPSummary Level Planning PackageFar-term activities not yet defined into CAs

    TCPITo Complete Performance IndexEfficiency needed from ‘time now’ to achieve an EAC

    EVM POLICY:DoDI 5000.2, Table E3.T2 .EVMS in accordance with ANSI/EIA-748 is required for cost or incentive contracts, subcontracts, intra-government work agreements, & other agreements valued >$20M (Then-Yr$). EVMS contracts >$50M (TY $) require that the EVM system be formally validated by the cognizant contracting officer. Additional Guidance in Defense Acquisition Guidebook and the Earned Value Management Implementation Guide (EVMIG). EVMS is discouraged on Firm-Fixed Price, Level of Effort, & Time &Material efforts regardless of cost.

    EVM CONTRACTING REQUIREMENTS:

    Non-DoDFAR Clauses – Solicitation – 52.234-2 (Pre-Award IBR) or 52.234-3 (Post Award IBR)

    –Solicitation & Contract – 52.234-4

    DoD( ≥ $20M) DFAR Clauses - 252.234-7001 for solicitations and 252.234-7002 for solicitations & contracts

    Contract Performance Report – DI-MGMT-81466A * 5 Formats (WBS, Organization, Baseline, Staffing & Explanation)

    Integrated Master Schedule – DI-MGMT-81650 * (Mandatory for DoD EVMS contracts)

    Integrated Baseline Review (IBR) - Mandatory for all EVMS contracts

    * See the EVMIG for CPR and IMS tailoring guidance.

    Cost Variance

    $

    ACWP

    BCWS

    BCWP

    time

    Time

    Now

    Completion

    Date

    BASELINE EXECUTION INDEX (BEI) (Schedule Metric)

    BEI = # of Baseline Tasks Actually Completed / # of Baseline Tasks Scheduled for Completion

    EVM Home Page = https://acc.dau.mil/evm eMail Address: [email protected]

    DAU POC: (703) 805-5259 (DSN 655)

    Revised April 2008

    Earned Value Management

    ‘Gold Card’

    VARIANCESFavorable is Positive, Unfavorable is Negative

    Cost VarianceCV= BCWP – ACWPCV % = (CV / BCWP) *100

    Schedule Variance SV= BCWP – BCWSSV % = (SV / BCWS) * 100

    Variance at CompletionVAC= BAC – EAC

    OVERALL STATUS

    % Schedule = (BCWSCUM / BAC) * 100

    % Complete= (BCWPCUM / BAC) * 100

    % Spent= (ACWPCUM / BAC) * 100

    DoD TRIPWIRE METRICSFavorable is > 1.0, Unfavorable is < 1.0

    Cost Efficiency CPI = BCWP / ACWP

    Schedule Efficiency SPI = BCWP / BCWS

    CRITICAL PATH LENGTH INDEX (CPLI) (Schedule Metric)

    CPLI = (Critical Path Duration + Float Duration (to baseline finish)) / Critical Path Duration

    TO COMPLETE PERFORMANCE INDEX (TCPI) # §

    TCPIEAC = Work Remaining / Cost Remaining = (BAC – BCWPCUM)/ (EAC – ACWPCUM)

    ESTIMATE AT COMPLETION#

    EAC= Actuals to Date+ [(Remaining Work) / (Efficiency Factor)]

    EACCPI= ACWPCUM + [(BAC – BCWPCUM) / CPICUM ]=BAC / CPICUM

    EACComposite= ACWPCUM + [(BAC – BCWPCUM) / (CPICUM* SPICUM)]

    #To Determine a Contract Level TCPI or EAC; You May Replace BAC with TAB

    § To Determine the TCPI BAC or LRE Replace EAC with either BAC or LRE


  • Login