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Earnvalue analysis in Software engineering

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Earnvalue analysis in Software engineering

  1. 1. EARNVALUE ANALYSIS
  2. 2. What is Earned value ? => It is combines measurements of 1. Scope - your original plan 2. Schedule - Current plane 3. Cost - Budget Vs. Actual primavera variable 4. Planned value - cost and schedule information baseline 5. Actual Value - Actual cost 6. Earned Value -What has physically been built
  3. 3. Here we define some variables : • ACWP = Actual Cost of Work Performed • BCWP = Budgeted Cost of Work Performed • BCWS = Budgeted Cost of Work Scheduled • CPI = Cost Performance Index • CV = Cost Variance • SPI = Schedule Performance Index • SV = Schedule Variance
  4. 4. • CPI (Cost Performance Index) = BCWP ACWP • If CPI > 1 than project is under budget . • If CPI < 1 than project is over budget. • CV (Cost Variance) = BCWP - ACWP • If CV > 0 than project is under budget otherwise • If CV < 0 than project is over budget. • SPI (Schedule Performance Index) = BCWP BCW𝑆 • If SPI > 1 than project ahead of schedule project behind schedule. • If SPI < 1 than project behind schedule. • SV (Schedule Variance) = BCWP - BCWS • If SV > 0 than project ahead of schedule . • If SV < 0 than project behind schedule.
  5. 5. Let’s understand earned value : project period = 5 day cost per day = 400 Reporting time = after 3rd day 1000 3rd day(reporting day) ACWP = 1000 BCWP = 800 [“Earned value (EV) ”] BCWS = 1200 Cost 1 2 3 4 5 Cost/day 400 400 400 400 400
  6. 6. CPI = BCWP ACWP = 800 1000 = 0.8 < 1 => Project over budget . CV = BCWP – ACWP = 800 – 1000 = -200 < 0 => Project over budget . SPI = BCWP BCW𝑆 = 800 1200 = 0.66 < 1 => Project is behind schedule . SV = BCWP – BCWS = 800 – 1200 = -400 < 0 => Project is behind schedule .
  7. 7. Example: Activity Predecessor Duration(day) Cost/day Total cost A 2 300 600 B A 3 400 1200 C B 3 400 1200 D B 2 200 400 E D 3 100 300
  8. 8. Field report at end of day 7 Activity Actual % complete Incurred cost A 100 600 B 100 1400 C 33 500 D 50 200 E 0 0 E 0 1 2 3 4 5 6 7 8 9 10 duration(days) Activity A B C D E Field reporting dayGantt chart
  9. 9. Activity ACWP BCWP BCWS CPI CV SPI SV A 600 600 600 B 1400 1200 1200 C 500 400 800 D 800 200 400 E 0 0 0 Total to date 2700 2400 3000 0.889 -300 0.80 -600 Calculation of all variable (till reporting day) CPI = BCWP ACWP = 2400 2700 = 0.889 < 1 => Project over budget . CV = BCWP – ACWP = 2400 – 2700 = -300 < 0 => Project over budget . SPI = BCWP BCW𝑆 = 2400 3000 = 0.80 < 1 => Project is behind schedule. SV = BCWP – BCWS = 2400 – 3000 = -600 < 0 => Project is behind schedule.
  10. 10. Earned value graph Report date ACWP BCWP BCWS Scheduled end of projectStart of project Cumulativeprojectcost
  11. 11. Thank You

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