Understanding earned value fields

Remember the Earned Value report from Chapter 12? The fields that appear as headings in that report also appear on various earned value tables. Earned value fields are currency fields that measure various aspects of earned value. The following table translates the acronyms that Project uses to represent the earned value fields.

Acronyms

Earned Value Fields

BCWS

Budgeted Cost of Work Scheduled

BCWP

Budgeted Cost of Work Performed

ACWP

Actual Cost of Work Performed

SV

Schedule Variance

CV

Cost Variance

BAC

Budgeted at Completion

EAC

Estimate at Completion

VAC

Variance at Completion

Three of the preceding fields are really at the heart of earned value analysis, as follows:

♦ BCWP indicates how much of a task's budget should have been spent given the actual duration of the task. For example, suppose that you have a task budgeted at $100 and work has been performed for one day. You find that, after one day, 40 percent of the work has been completed. You would expect that 40 percent of the cost of the task, or $40, would also be incurred. Therefore, the BCWP for the task is $40.

♦ BCWS measures the budgeted cost of individual tasks based on the resources and fixed costs that are assigned to the tasks when you schedule them.

♦ ACWP measures the actual cost that is incurred to complete a task. During the completion process, ACWP represents the actual costs for work performed through the project's status date.

BCWS, BCWP, ACWP, SV, and CV are all calculated through today or through the project status date. SV represents the cost difference between current progress and the baseline plan, and Project calculates this value as BCWP minus BCWS. CV represents the cost difference between actual costs and planned costs at the current level of completion, and Project calculates this value as BCWP minus ACWP. EAC

shows the planned costs based on costs that are already incurred plus additional planned costs. VAC represents the variance between the baseline cost and the combination of actual costs plus planned costs for a task.

Note Project calculates BCWP at the task level different from how it calculates BCWP at the assignment level. Because Project rolls the task-level BCWP values into summary tasks and the project summary task, I suggest that you use the task-level BCWP values.

Project uses BCWS, BCWP, ACWP, SV, and CV as task fields, resource fields, and assignment fields; Project also uses timephased versions of each field. BAC, EAC, and VAC, however, are task fields only.

Project 2003 introduced some new earned value fields. Some of these fields appear by default on earned value tables, and you can add any of these fields to any table. Project 2003's new earned value fields are as follows:

♦ Physical % Complete: This field represents your estimate of the progress of a task, regardless of actual work or time, and is not a timephased field. Project calculates Physical % Complete by rolling up BCWP on subtasks to BCWP on associated summary tasks. You enter Physical % Complete estimates, and Project applies the Physical % Complete to assignment data or Fixed Costs data for the associated summary task. See the next section for details on having Project use Physical % Complete as the method for calculating earned value.

Note You may be wondering about the difference between % Complete, which is not new to Project 2003, and Physical % Complete. Project calculates % Complete by dividing actual task duration by total duration. Physical % Complete is your estimate of where a task stands and has no connection to duration.

♦ CPI: CPI stands for Cost Performance Index, and Project calculates CPI by dividing BCWP by ACWP. This field appears by default in the Earned Value Cost Indicators table and is a timephased field.

♦ SPI: SPI stands for Schedule Performance Index, and Project calculates SPI by dividing BCWP by BCWS. This field appears by default in the Earned Value Schedule Indicators table and is a timephased field.

♦ CV%: CV% stands for Cost Variance %, and Project calculates this field by dividing CV by BCWP and multiplying the result by 100. This field appears by default in the Earned Value Cost Indicators table and is a timephased field.

♦ SV%: SV% stands for Schedule Variance %, and Project calculates this field by dividing SV by BCWS and multiplying the result by 100. This field appears by default in the Earned Value Schedule Indicators table and is a timephased field.

♦ EAC: EAC stands for Estimate at Completion, and although this field isn't new (it existed in Project 2000), it is improved in Project 2003. Project calculates this field by using the following formula: ACWP + (BAC - BCWP) / CPI. This field appears by default in the Earned Value for Tasks and the Earned Value Cost Indicators tables and is not a timephased field.

In Project 2000, EAC was simply the cost of the task, because EAC was nothing more than the task's cost, retitled to "EAC." In Project 2003, the field is a new, separate field with a formula behind it.

♦ TCPI: TCPI stands for To Complete Performance Index, and Project calculates this field by using the following formula: (BAC - BCWP) / (EAC - ACWP). This field appears by default in the Earned Value Cost Indicators table and is not a timephased field.

Using the Physical % Complete method to calculate earned value

Project can use the % Complete method or the Physical % Complete method to calculate earned value. Unless you specify otherwise, Project uses the % Complete method.

You can set Physical % Complete as the default earned value calculation method for your project by following these steps:

1. Choose Tools O Options.

2. Click the Calculation tab.

3. Click the Earned Value button. You see the Earned Value dialog box, as shown in Figure 14-1.

Earned Value

m

Défaut task Earned Value method: | Physical % Complete

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Figure 14-1: Choose the method of earned value calculation that you want Project to use.

4. From the Default task Earned Value method list box, choose Physical % Complete.

5. From the Baseline for Earned Value calculations list box, choose a baseline

(Project stores 11 baselines for earned value).

Note Clearing a baseline after entering Physical % Complete values does not clear those

6. Click OK twice to save the settings.

The preceding steps set the default for all new tasks that you enter in your project. If your project already contains tasks (or if you want to use the Physical % Complete method for some but not all tasks), set the earned value calculation method on a task-by-task basis. Follow these steps to do so:

1. Select the task(s) for which you want to set the earned value calculation method to Physical % Complete.

2. Click the Task Information button on the Standard toolbar.

3. Click the Advanced tab.

4. From the Earned value method list box, choose Physical % Complete, as shown in Figure 14-2.

Figure 14-2: Assign the Physical % Complete method as appropriate to tasks in the Task Information dialog box.

To record Physical % Complete, add the field as a column on a table view (in Figure 14-3, I've added it to the Earned Value for Tasks table), and then type in appropriate amounts for tasks. You'll see other earned value fields update accordingly.

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Task Name

Physical % Compiete

BCWS

BCW

ACWP

SV

cv

EAC

BAC

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2

- Conference - Preplanning

0% 0%

$0.00 $0.00

$0,00 90.00

$0.00 $0.00

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$7,217.50 $920.00

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7

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$0.00

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$2,537.50

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8

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11

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$0.00

12

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Bartenders

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16

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17

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Figure 14-3: Record Physical % Complete values by adding the field to a table and then typing in the information.

Tip To insert a column, click the heading of the column to the right of the column that

% you are inserting. Then choose InsertOColumn.

Setting the date for earned value calculations

By default, Project uses today's date to calculate earned value information. However, you can set a project status date for Project to use instead of today's date when it calculates earned value. From any view, choose Project O Project Information to open the Project Information dialog box, as shown in Figure 14-4.

From the Status Date list box, select the date that you want Project to use when it calculates earned value, and click OK.

Figure 14-4: Use this dialog box to set a date for Project to use when calculating earned value.
Project Management Made Easy

Project Management Made Easy

What you need to know about… Project Management Made Easy! Project management consists of more than just a large building project and can encompass small projects as well. No matter what the size of your project, you need to have some sort of project management. How you manage your project has everything to do with its outcome.

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