Provision of capacity building services to Egyptian Water and Sanitation public agencies
THE AMERICAN UNIVERSITY IN CAIRO
Sustainable Rural Sanitation Services Program for Results (SRSSP)
DEVELOPMENT OF A KNOWLEDGE AND CAPACITY BUILDING HUB
Capacity building services to Egyptian Water and
Sanitation public agencies
Construction Management Module

Provision of capacity building services to Egyptian Water and Sanitation public agencies
THE AMERICAN UNIVERSITY IN CAIRO
Foundations of Schedule Controls
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Provision of capacity building services to Egyptian Water and Sanitation public agencies
THE AMERICAN UNIVERSITY IN CAIRO
LEARNING OUTCOMES
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 Define Earned Value Management and its functions in project controls
 Understand Earned Value Management process
 Gather the project data from which to calculate the status and/or forecast
 Calculate basic measures required for Earned Value
 Calculate Earned Value using defined methods

Provision of capacity building services to Egyptian Water and Sanitation public agencies
THE AMERICAN UNIVERSITY IN CAIRO
OUTLINE
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● Introduction
● Project Controls
● Budget At Completion (BAC)
● Planned Value (PV)
● Actual Cost (AC)
● Earned Value (EV) Methods

Provision of capacity building services to Egyptian Water and Sanitation public agencies
THE AMERICAN UNIVERSITY IN CAIRO
PROJECT CONTROLS: EARNED VALUE MANAGEMENT
• The standard for project controls
• Helps determine if your project is on schedule and within budget.
• Assesses the project on the basis of cost and schedule as compared to what has
been accomplished.
Importance of Earned Value Management
1. A real time snapshot of the project in the form of Time & Cost
2. Forecast at project completion assuming future performance is same as current
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Provision of capacity building services to Egyptian Water and Sanitation public agencies
THE AMERICAN UNIVERSITY IN CAIRO
PROJECT CONTROLS: EARNED VALUE MANAGEMENT
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Earned Value
Management
Gather Work
Performance
Information
Determine
Schedule
Status
Determine
Cost Status
Forecasting

Provision of capacity building services to Egyptian Water and Sanitation public agencies
THE AMERICAN UNIVERSITY IN CAIRO
1. WORK PERFORMANCE INFORMATION
The project data from which to calculate the
project status and/or forecast:
a) Budget At Completion (BAC)
b) Planned Value (PV)
c) Actual Cost (AC)
d) Earned Value (EV)
These are preferably gathered on a task by task
basis, not for the overall project
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Earned Value
Management
Gather Work
Performance
Information
Determine
Schedule
Status
Determine
Cost Status
Forecasting

Provision of capacity building services to Egyptian Water and Sanitation public agencies
THE AMERICAN UNIVERSITY IN CAIRO
a. BUDGET AT COMPLETION (BAC)
• Budget at Completion (BAC) Is the budget allocated on each task in the schedule if
we are talking task by task
• Is the cumulative sum of all budgets allocated to a project scope
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Intake Pipeline
Installation
Jan Feb Mar Apr May
Budget Cost 20,000 LE 14,000 LE 22,000 LE 30,000 LE 12,000 LE
Budget at completion for this package (BAC) = 98,000 LE
Example:
Assume the Intake Pipeline Installation Package, planned package duration is 5 months

Provision of capacity building services to Egyptian Water and Sanitation public agencies
THE AMERICAN UNIVERSITY IN CAIRO
b. PLANNED VALUE (PV)
• The physical work scheduled and the approved budget to accomplish the scheduled work.
• Defined by a value : Planned Value (PV) = Physical Work + Approved Budget
• Also known as Budget Cost of Work Scheduled (BCWS)
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Planned Value
(PV)
Cumulative
Planned Value
Current
Planned Value
Sum of the approved
budget for activities to
be performed to date
Approved budget for
activities scheduled to
be performed during a
given
period

Provision of capacity building services to Egyptian Water and Sanitation public agencies
THE AMERICAN UNIVERSITY IN CAIRO
b. PLANNED VALUE (PV)
PV (at 15th January) : 50% has passed from January = 50% x 20,000 = 10,000 LE
Cumulative PV (Jan – Mar) = 56,000 LE
Current PV for Mar = 22,000 LE
Budget for this package (BAC) = 98,000 LE
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Intake Pipeline
Installation
Jan Feb Mar Apr May
Budget Cost 20,000 LE 14,000 LE 22,000 LE 30,000 LE 12,000 LE
Current Date 2
Current Date 1

Provision of capacity building services to Egyptian Water and Sanitation public agencies
THE AMERICAN UNIVERSITY IN CAIRO
c. ACTUAL COSTS (AC) : EXPENDITURES
• Actual Cost (AC) the cost incurred for executing work on a project up to a status point
• Cumulative AC is the sum of the actual cost for activities performed to date,
• Actual Cost (AC) is also called Actual Cost of Work Performed (ACWP).
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Actual Cost
(AC)
Cumulative
Actual Cost
Current
Actual Cost
Sum of the actual
cost for activities to
be performed to date
The Actual costs of
activities to be
performed during a
given period

Provision of capacity building services to Egyptian Water and Sanitation public agencies
THE AMERICAN UNIVERSITY IN CAIRO
c. ACTUAL COSTS (AC) : EXPENDITURES
Cumulative AC (Jan – Mar) = 52,000 LE
Current AC for Mar = 5,000 LE
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Intake Pipeline
Installation
Jan Feb Mar Apr May
Budget Cost 20,000 LE 14,000 LE 22,000 LE 30,000 LE 12,000 LE
Actual Cost 30,000 LE 17,000 LE 5,000 LE
Current Date

Provision of capacity building services to Egyptian Water and Sanitation public agencies
THE AMERICAN UNIVERSITY IN CAIRO
d. EARNED VALUE (EV): REPORTED ACCOMPLISHMENTS
• Earned Value (EV) is the quantification of the “worth” of the work done to date
• Also called the Budget Cost of Work Performed (BCWP),
• EV is the measure of the work performed at a specific point in time, expressed in terms of the
approved budget authorized for that work
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Earned Value
(EV)
Cumulative
Earned Value
Current
Earned Value
The sum
of the budget for the
activities accomplished to
date.
The sum of the
budget for the activities
accomplished in a given
period.

Provision of capacity building services to Egyptian Water and Sanitation public agencies
THE AMERICAN UNIVERSITY IN CAIRO
d. EARNED VALUE (EV): OBJECTIVE
The PV is the target, whereas EV and AC are the “darts.” The AC and EV are always changing. Every
day another dart gets thrown at the board, and it’s the project manager’s job to keep AC and EV
close to the PV.
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Planned
Value (PV)
Actual
Cost (AC)
Earned
Value (EV)

Provision of capacity building services to Egyptian Water and Sanitation public agencies
THE AMERICAN UNIVERSITY IN CAIRO
d. EARNED VALUE : CALCULATION METHODS
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Earned Value
Calculation
Methods
Fixed
Formula
Milestone
Weights
Milestone
Weights
with %
Complete
Units
Complete
Percent
Complete
Level of
Effort

Provision of capacity building services to Egyptian Water and Sanitation public agencies
THE AMERICAN UNIVERSITY IN CAIRO
EV METHODS: 1. FIXED FORMULA
• This method applies a percent complete to the start and finish of an activity.
• Generally, the percentages used in the formula are 0/100, 50/50, or 25/75.
• This works well for short term packages (< 3 months) and not very effective for long term work
packages
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Fixed
Formula
0/100 - Nothing is earned when activity starts but 100% of
budget is earned when completed
50/50 - 50% is earned when activity starts and the balance is
earned on completion
25/75 - 25% is earned when activity starts and the balance is
earned on completion

Provision of capacity building services to Egyptian Water and Sanitation public agencies
THE AMERICAN UNIVERSITY IN CAIRO
EV METHODS : 2. MILESTONE WEIGHTING
• Assigns budget value to each milestone. Not until full completion of each milestone is the
budget earned.
• Milestone Weighting is used as a method for work packages with long term durations and
ideally should have milestones each month or accounting period
Advantages:
Requires objective measurable milestones, which most customers or Project Managers prefer
Disadvantages:
Does not allow partial credit for in-process work, and requires detailed milestone planning
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Provision of capacity building services to Egyptian Water and Sanitation public agencies
THE AMERICAN UNIVERSITY IN CAIRO
EV METHODS : 2. MILESTONE WEIGHTING
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1 2 3 4
Current EV = 5,000 LE
Cumulative EV = 5,000 LE
Current EV = 0 LE
Cumulative EV = 5,000 LE
Current EV = 12,000 LE
Cumulative EV = 17,000 LE
Current EV = 80,000 LE
Cumulative EV = 97,000 LE
1
2
3
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Provision of capacity building services to Egyptian Water and Sanitation public agencies
THE AMERICAN UNIVERSITY IN CAIRO
EV METHODS : 3. MILESTONE WEIGHTING WITH % COMPLETE
• Assigns budget value to each milestone, and it is earned based on the percent of work
Completed against each individual milestone.
• Milestone Weighting is used as a method for work packages with long term durations and
ideally should have milestones each month or accounting period
Advantages:
Requires objective measurable milestones, which most customers prefer, and allows for partial
credit against milestones
Disadvantages:
Requires a Control Account Manager (CAM) assessment of the % complete for each milestone and
requires documentation of assessment methodology
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Provision of capacity building services to Egyptian Water and Sanitation public agencies
THE AMERICAN UNIVERSITY IN CAIRO
EV METHODS : 3. MILESTONE WEIGHTING WITH % COMPLETE
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1 2
Current EV = 5,000 LE
(using Milestone Weighting)
Cumulative EV = 5,000 LE
Current EV = 0 LE
(using Milestone Weighting)
Current EV = 75% x 12,000 = 9,000 LE
(using Milestone Weighting % Complete)
Cumulative EV = 5,000 + 9,000 = 14,000 LE
1 2

Provision of capacity building services to Egyptian Water and Sanitation public agencies
THE AMERICAN UNIVERSITY IN CAIRO
EV METHODS : 4. UNITS COMPLETE
• Uses a physical count to determine what is earned
• To use Unit Complete you must have units that are identical or similar and they must have the
same budget value
Advantages:
An objective and easy way of determining the earned value for an activity
Disadvantages:
Limited to production type atmosphere of similar items that are fixed unit prices.
Does not take into consideration labor fluctuations so may misrepresent actual EV
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Provision of capacity building services to Egyptian Water and Sanitation public agencies
THE AMERICAN UNIVERSITY IN CAIRO
EV METHODS : 4. UNITS COMPLETE
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Provision of capacity building services to Egyptian Water and Sanitation public agencies
THE AMERICAN UNIVERSITY IN CAIRO
EV METHODS : 5. SUBJECTIVE PERCENT COMPLETE
• Applies a percent complete to a budget value to determine what is earned. The percent
complete value is determined by the Control Account Manager or other designated individuals.
• The percent complete is applied to the Budget at Completion (BAC) for a given activity to
determine the current and cumulative EV.
Advantages:
Earned Value is based on the CAM’s assessment of the work package progress. Detailed planning at
the milestone level is not required.
Disadvantages:
This method is highly subjective, and documentation in support of percent complete derivations is
required.
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Provision of capacity building services to Egyptian Water and Sanitation public agencies
THE AMERICAN UNIVERSITY IN CAIRO
EV METHODS : 5. SUBJECTIVE PERCENT COMPLETE
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The design manager assumes that by mid Jan 70% of the design is complete; therefore,
Current EV = 70% x 5,000 = 3,500 LE
(using Subjective % Complete)
Cumulative EV = 3,500 LE
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Provision of capacity building services to Egyptian Water and Sanitation public agencies
THE AMERICAN UNIVERSITY IN CAIRO
EV METHODS : 6. LEVEL OF EFFORT
• The Level of Effort (LOE) method is based on the passage of time. A monthly budget value is
earned with the passage of time and is always equal to the monthly planned amount.
• When using LOE, the PV is always equal to the EV
Advantages: This EVM does not require statusing, and is appropriate for sustaining tasks like
Program Management.
Disadvantages: LOE work packages require accurate assessment (planning) of monthly
performance..
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Provision of capacity building services to Egyptian Water and Sanitation public agencies
THE AMERICAN UNIVERSITY IN CAIRO
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