Earned value Management

Hi ,

I am asked to write a Earned Value Management procedure for a large road construction project. I have some basic ideas, but i would liek to get a brain storming session here and see how far i can make use of the points we discuss here. I request you guys to post any relevant information here.

Thanks in advance,

Srinivasa Raju

Haresh,



That’s correct and basic steps in EVM.

It’s a long explanation if I explain the whole Process of EVM from setup to implementation/ tracking/ analysis/ control etc...



To give you a little bit of idea, EVM like what I have mention on my previous post requires procedure on how it was going to setup & implement.

It varies on the size of the Project but generally same process. The key player may change depends on how big the project is and how detail EVM to control and implement.

1) Managing of Cost Account or control account - big projects may needs Account Manager/ Cost controller/ Cost Administrator/ QS

 Includes creation of CBS (Cost Breakdown Structure) and its detail

 Cost element/ Cost type – identification and allocation to cost account

 Identification of actual cost – cost account/ cost type (PO, Invoice, Subcontractors, indirect, direct… etc)

2) WBS creation -> cost account should be as close as possible to WBS or as long as it is easy to allocate to WBS

3) WBS responsibilities -> Each WBS with corresponding CBS should be allocated to site/project engineer/ supervisor/ foreman to manage their WBS and cost. (varies on size it can be PM responsibility if Project is to small and manageable)

4) Change control Management – Project Control Manager/ Account Manager/ Cost Controller -> cost allocation/ approval/ register/ management

5) Baseline Creation – Planner/ Scheduler/ Cost Controller -> Cost loading, resource loading/ cost account allocation/ budgeting/ EVM setup and control technique

If all of those setup are done and key players are identified then implementation will be mixture of key player contribution to the success of EVM which includes EVM analysis, cash flow, forecast, trending and cost review & management.

are you looking for analysis?



negative variance or index less than 1 = time delayed / overrun cost



positive variance or index more than 1 = time ahead / underrun cost



zero variance or index is 1 = time is on schedule / break-even cost

Haresh,

I’m not really sure what is your problem. If you already show all the columns as you mention then what else is missing or are you looking for values for SV, CV, PV, AV, EV?



All Values in each columns mentioned will not have values until the project start and data date is move from Project Start to first cut-off date and or to current date.

BCA, ETC & EAC will have the same value and others are zero.

Budget spread, Plan spread and Estimate At Completion spread are available per timescale at Activity Usage Spreadsheet.

Haresh,

For EV calculation just accepts the default:

Admin-> Admin Preferences-> Earned Value tab-> Earned Value Calculation



What exactly you did not understand?

Haresh,

In P6 there are so many ways of tracking EVM which needs to write a procedure first and agreed how it needs to be track.

First is to have an agreed baseline to use for EVM which have different option to set in P6.

* Project Window-> settings tab-> Project Baseline or Users Primary Baseline

You can use Project Baseline for EV baseline and use current Project in User’s Primary Baseline for what if analysis or vice versa.



Second need to decide what is the agreed technique for computing performance percent complete (physical progress) of EVM.

* Admin-> Admin Preferences-> Earned Value

1) Activity % Complete

2) Use WBS Milestone

3) 0/100% complete

4) 50/50 % complete

5) custom % complete (i.e. 4 step, 6 steps…etc...)

or mixture of all of the above which can be set on each wbs

• WBS Window-> Earned Value tab



Third Technique for computing Estimate to Complete (ETC)

* Admin-> Admin Preferences-> Earned Value

1) ETC = Remaining cost of activity

2) ETC = PF* (Budget at completion – EV) Where PF = ????



For Earned Value Calculation using Baseline by default it use = Budgeted Value with planned date and can change if running what if analysis to Budgeted Value with current date or At Completion Values with current dates



BCWP = EV = Performance % Complete (physical progress) * BAC

BCWS = PV = Schedule % Complete (Plan progress) * BAC

ACWP = AV = Actual Cost

SV = EV – PV

CV = EV – AC

Etc…

All of this values are available in Activity Window (columns -> Earned Value and Graph EV profile), WBS Window (columns -> Earned Value), Project Window (columns -> Earned Value), Tracking Window (columns -> Earned Value and Graph EV profile)

Below link is where I explain the Objective and Field Definition of EVM

Schedule % Complete Post #17

Earned value units or earned value cost