The Earned Value (EV) Management System in the Context of Critical Chain Project Management (CCPM).
Earned Value is founded on a cost-centric approach, assuming that the Costs Allocated to Tasks are accurate relative to the project Timeline (allocating costs months and years in advance to overstated Task durations is an inaccurate projection).
Critical Chain Project management (CCPM) principals generate a practical, executable, and feasible Project Schedule, and when subject to responsive management, is an attainable timeline. A CCPM reconfigured schedule accounts for task dependencies and practical and realistic resource allocation.
Combining CCPM and EV: The CCPM EV, in conjunction with costing methodologies including Rate x Hours or (Rate x Units) allocated and synchronized to Tasks in an executable schedule, is employed to gauge the project’s advancement. This assessment allows allocating costs to executable and budgeted tasks, facilitating a more realistic EV progress report.
Applying Exeprons Earned Value Module:
Ensure that the Project Tasks are populated with the appropriate costing data, Resource Types, Resource Units of Consumption, and Rates per Unit of Consumption. Refer to the Reference Guide Module: Finance and Budgeting.
Access Exepron Earned Value Module.
Earned Value is an individual Project related feature; therefore, navigate to the Project Dashboard.
The Project Report Menu has two separate Report Tables with Charts.
- Portfolio Dashboard/ Project Dashboard (Project Name) / Reports / Project Earned Value
- Portfolio Dashboard/ Project Dashboard (Project Name) / Reports / Earned Value Performance
Reporting Variances and Ratios
From the primary metrics, cost and schedule variances can compare a project’s actual progress with the planned progress. Here, the planned progress will be measured by the progress of the tasks as depicted in the traditional project schedule. Variances are, in absolute amounts, only useful for individual projects; ratios are relative measures and can be used to compare the progress of multiple projects.
- Cost Variance (CV): EV minus AC.
- Cost Performance Index (CPI): EV divided by AC.
- Schedule Variance (SV): EV minus PV.
- Schedule Performance Index (SPI): EV divided by PV.
Project Earned Value Report and Chart
Forecasting Metrics
CPI and SPI are used in new calculations to predict the project’s remaining cost and its total revised cost.
- Estimate to Complete (ETC): The cost of the work required to complete the project. It is (TV minus EV) divided by CPI. To be more conservative, some contracts may require the consideration of both the cost and schedule indices. Then ETC would equal (TV minus EV) divided by (CPI multiplied by SPI).
- Estimate at Completion (EAC): The revised total cost of the completed project. It is AC plus ETC.
- To Complete Performance Index (TCPI): (TV minus EV) divided by (EAC minus AC).
Earned value Performance Report and Chart
