1.
SIMPLE SAMPLE
MEMORANDUM
ROGER H. MANDEL
Rmandel@PramsCo.com
Mobile #: 858-735-2038
Date: 30 April 2018
To: Program Management
Subj.: EARNED VALUE PROJECT MANAGEMENT ANALYSIS REPORT, Data
through 31 March 2018
1. Summary Status:
a. Data indicates the performance changes, as shown on Figure #1, from 31
January 2017 to 31 March 2018 as follows:
i. Percent scheduled to be completed at 68.02%
ii. Percent complete 46.76%, about 22% behind schedule
iii. Percent Spent of Budget at 64.39%, about 17.63% cost overrun
iv. Percent spent of Latest Revised Estimate at 54.71%
Figure #1
-
2,000,000
4,000,000
6,000,000
8,000,000
10,000,000
12,000,000
14,000,000
16,000,000
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25
SIMPLE SAMPLE
Budget $13.9M
Planned $9.48M
Schedule Variance
$2.98M
Cost Variance in
$2.45M
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2.
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2. Trends, as shown on Figure #2:
a. With 15 months of data:
i. Schedule performance changed from 69.3% to 68.6%. Cumulative SPI 0.686.
ii. Cost performance changed from 75.2% to 72.6%. Cumulative CPI 0.726.
iii. Schedule and Cost Performance has a negative trend as shown on Figure #2
below.
Figure #2
0.400
0.500
0.600
0.700
0.800
0.900
1.000
1.100
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16
CPI 0.726
SPI 0.686
SIMPLE SAMPLE
Cumulative
3. Projections:
a. The analyst projects a significant cost overrun due to the
negative trends in cost performance. The Vendors Estimate at Completion
(EAC) changed from a cost overrun of about $1.97 million to now more like $2.45
million over the current performance measurement baseline of $13.9 million.
b. The significant trend data indicates a poor schedule
performance cumulative to date at about 68.6%. That calculated for every 100
hours planned the progress is at 68.6 hours. The SPI is 0.686.
c. The cumulative cost performance to date is at 72.6%. That
calculated for every $100 dollars expended the contractor earns (accomplishes)
$72.6 dollars’ worth of work. The CPI is 0.726.
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4. Choice and Rationale:
a. The worst-case projection for the scheduled completion date, for these efforts,
will be missed by about 13 months. Scheduled completion date is stated as
January 2019. Completion is projected to be March 2020.
5. Major Areas of Concern as shown on Figure #3:
a. The behind schedule is shown as be being greater than 3
months and is projected to grow to, worst case at, 13 months. With only 15
months of data, the contractor is behind schedule by greater than 3 months, as
show of Figure #3.
b. Cost variance grew from -$1,970,000 to -$2,450,000.
Figure #3
150,000
2,150,000
4,150,000
6,150,000
8,150,000
10,150,000
12,150,000
SIMPLE SAMPLE
SV In Time
Greater than 3
months
6. Exhibit as shown on Figure # 4:
a. Analyst’s (Worst Case) Estimated Cost at Completion is $23.3 M.
b. Contractor’s Estimated Cost at Completion at $16.4 M.
c. Budget at $13.9 M.
d. Planned performance to date is $9.48 M.
e. Expended to date is $9.95 M.
f. Earned to date is $6.5 M.
g. Currently at least 3+ months behind schedule.
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h. Cost overrun to date is $2.45 M.
Figure #4
Program: As of: 31-Mar-2018
Planned Earned Expended SV CV Budget Vendor's EAC
$9,480,000 $6,500,000 $8,950,000 ($2,980,000) ($2,450,000) $13,900,000 $16,350,000
Percent
Complete
Work
Remaining
Cumulative
CPI
6 Month
Moving Average
3 Month
Moving Average
Independent
Projection
Worst Case
Completed 15
Reporting
Periods
0.726 0.771 0.608 0.304 Independent
$10,189,231 $9,592,363 $12,164,384 $24,342,105 Projection
$19,139,231 $18,542,363 $21,114,384 $33,292,105 Worst Case
2.19%
3 MMA Current Work Remaining
4.38% 3.74% 53.24%
Independent Projected Completion Date 29-Mar-2020
31-Jan-2019
$24,342,105
$16,942,105
$33,292,105
Best Case $19,139,231
Most likely $26,215,668
Worst Case $33,292,105
Independent EAC
Project Cost Overrun
Projection of Average Earning Per Month for Remaining Work
Percent Complete
Cost of Work Remaining To Complete Performance Index
46.76%
Independent EAC
$7,400,000
Contract Completion Date
Independent Total Estimated Cost to Go
Dollars as StatedSIMPLE SAMPLE
Copy to:
The Essential EVM Formulas
Acronyms:
AC: Actual Cost (ACWP means Actual Cost of Work Performed). The cost for
the work performed.
ACWP: Actual Cost of Work Performed.
BAC: Budgeted at Completion, also Authorized Budget also Total Planned Value.
BCWP: Budget Cost for Work Performed. Completed (accomplished) budgeted work.
BCWS: Budget Cost for Work Scheduled. The cost for the work performed.
CPI: Cost Performance Index. Earned divided by Expended.
CV: Cost Variance. The mathematical difference between Earned and Expended.
EAC: Estimate at Completion
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EV: Earned Value (BCWP means Budgeted Cost for Work Performed) also
Accomplished Work
ETC: Estimate to Complete. The estimated cost to complete all budgeted work.
IEAC: Independent Estimate at Completion. Independent projected cost at the
completion of all budgeted work.
PV: Planned Value (BCWS means Budgeted Cost for Work Scheduled)
SV: Schedule Variance. The mathematical difference between Earned and Planned.
SPI: Schedule Performance Index. Earned divided by Planned.
TCPI: To Complete Performance Index. The cost efficiency factor to complete
budgeted work or to complete all work at the EAC value.
WR: Work Remaining. The difference between the budgeted value and work
accomplished.
Formulas:
Cost Performance Index (CPI): CPI = EV / AC
Cost Variance (CV): CV = EV - AC
Cost Variance % (CV %): CV% = 100 x (CV / EV)
Estimate at Completion (EAC): ACWP cumulative + (Work Remaining / The Average
Projected Cost Performance Index for work remaining)
Independent Estimate at Complete (IEAC): IEAC calculations are based on the use of a
Performance Index and should be so stated:
IEAC = AC cumulative + (BAC - EV cumulative)/ Performance Index
IEAC = AC + (BAC - EV) / CPI current
IEAC = AC + (BAC - EV) / SPI current
IEAC = AC + (BAC - EV) / (SPI * CPI)
IEAC = AC + (BAC - EV) / ((SPI * .20) + (CPI * .80))
IEAC = AC + (BAC - EV) / CPI cumulative x (x equals the cumulative of the last x
periods)
IEAC = AC + (BAC - EV) / Projected Average CPI to completion
Percent Complete: Percent Complete = 100 x (EV cumulative / BAC)
Percent Spent: Percent Spent = 100 x (AC cumulative / BAC (or EAC))
Schedule Variance (SV): SV = EV - PV
Schedule Variance % (SV %): SV% = 100 x (SV / PV)
Schedule Performance Index (SPI): SPI = EV / PV
To Complete Performance Index (TCPI): TCPI to EAC = Work Remaining / Cost
Remaining
TCPI EAC: = (BAC - EV) / (EAC – AC)
Variance at Complete (VAC): VAC = BAC – EAC
Variance at Complete % (VAC %): VAC % = 100 x (VAC / BAC)
Work Remaining: BAC - BCWP
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EV: Earned Value (BCWP means Budgeted Cost for Work Performed) also
Accomplished Work
ETC: Estimate to Complete. The estimated cost to complete all budgeted work.
IEAC: Independent Estimate at Completion. Independent projected cost at the
completion of all budgeted work.
PV: Planned Value (BCWS means Budgeted Cost for Work Scheduled)
SV: Schedule Variance. The mathematical difference between Earned and Planned.
SPI: Schedule Performance Index. Earned divided by Planned.
TCPI: To Complete Performance Index. The cost efficiency factor to complete
budgeted work or to complete all work at the EAC value.
WR: Work Remaining. The difference between the budgeted value and work
accomplished.
Formulas:
Cost Performance Index (CPI): CPI = EV / AC
Cost Variance (CV): CV = EV - AC
Cost Variance % (CV %): CV% = 100 x (CV / EV)
Estimate at Completion (EAC): ACWP cumulative + (Work Remaining / The Average
Projected Cost Performance Index for work remaining)
Independent Estimate at Complete (IEAC): IEAC calculations are based on the use of a
Performance Index and should be so stated:
IEAC = AC cumulative + (BAC - EV cumulative)/ Performance Index
IEAC = AC + (BAC - EV) / CPI current
IEAC = AC + (BAC - EV) / SPI current
IEAC = AC + (BAC - EV) / (SPI * CPI)
IEAC = AC + (BAC - EV) / ((SPI * .20) + (CPI * .80))
IEAC = AC + (BAC - EV) / CPI cumulative x (x equals the cumulative of the last x
periods)
IEAC = AC + (BAC - EV) / Projected Average CPI to completion
Percent Complete: Percent Complete = 100 x (EV cumulative / BAC)
Percent Spent: Percent Spent = 100 x (AC cumulative / BAC (or EAC))
Schedule Variance (SV): SV = EV - PV
Schedule Variance % (SV %): SV% = 100 x (SV / PV)
Schedule Performance Index (SPI): SPI = EV / PV
To Complete Performance Index (TCPI): TCPI to EAC = Work Remaining / Cost
Remaining
TCPI EAC: = (BAC - EV) / (EAC – AC)
Variance at Complete (VAC): VAC = BAC – EAC
Variance at Complete % (VAC %): VAC % = 100 x (VAC / BAC)
Work Remaining: BAC - BCWP
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