All,
I know this has been discussed before, but wanted to get some new feedback on the topic.
I have an earned value question associated with rebaselining a schedule on a firm fixed price contract. I’m an owner and I’m using EV concepts to monitor my project. For the first few months I experienced no contract modifications so my CPI value was always 1 with my SPI varying slightly based on how the contractor was doing.
I’m now in month 6 and I have a number of in-scope modifications that are necessary to account for discrepancies in the design. Let’s assume my initial BAC was $1,000,000 and now my modifications in month 6 will add an additional $100,000 in cost. My questions:
- Do I or should I consider rebaselining here? One thought is that my overall scope hasn’t changed so no I shouldn’t.
- If I don’t rebaseline, then my BAC is still $1,000,000 but when the contractor submits his request for payment, his Performance Percent Complete will now be based on the new $1.1M value. Would I use this new (% complete x BAC) to get my earned value for the month? This would then create a situation where my EV and AC are no longer 1 for the remainder of the project.
My thought is that isn’t a bad thing. It would show my CPI as less than 1 and indicate I’m over my initial plan. If I do rebaseline I’m effectively setting my CPI back to 1 and will never see a variance. What am I missing - good approach, or should I rebaseline at this point?