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You are a project manager on a project that uses earned value management. The project has the following budget and status:
Project Duration (months):
14
Current Reporting Period (month):
6
BAC:
$387,000
Cumulative PV:
$68,345
Cumulative AC:
$78,379
% of the project completed through the reporting period:
19%
Estimate to Complete:
$294,677
Part 1:
Based on this information, determine the following:
Cumulative EV
Schedule Variance (SV)
Schedule Performance Index (SPI)
Cost Variance (CV)
Cost Performance Index (CPI)
EAC (bottom-up)
VAC (bottom-up)
TCPI
Based on your calculations above, respond to the following:
What is the status of project accomplishment performance through the current reporting period? Why?
What is the status of project cost performance through the current reporting period? Why?
Is the project projected to complete overbudget or underbudget? Why?
Interpret the TCPI metric.
Part 2:
Based on your calculations above, an inexperienced and arrogant project analyst from the project management office has computed an additional metric: Cost Schedule Index, which equals SPI * CPI. He wants you to report this metric to the customer, instead of SPI and CPI separately. What should you do and why?
The program manager doubts your numbers. In particular, he does not believe your EAC number and requests that you calculate the EAC not assuming future performance will behave like past performance.
Compute EAC when cost performance is negative and schedule dates must be met: EAC = AC + [(BAC – EV) / (CPI × SPI)]
Compute EAC using actual costs to date and assuming ETC uses budgeted rate: EAC = AC + (BAC – EV)
Interpret the results of the EAC in a.
Interpret the results of the EAC in b.
Based on these new calculations, what do you think the program manager will request from you regarding the bottom-up EAC?
Part 3:
You are having a hallway conversation with the same project analyst who is now realizing that he may not know as much about earned value management as he thought when he joined the company. Still, he is convinced that the following statements below are correct. How would you respond to him based on each statement (i.e., formulate a specific response and supporting rationale for each statement below)?
EAC becomes Cumulative AC at project completion.
Cumulative EV can be greater than BAC at project completion.
EAC can be smaller than BAC at project completion.
ETC can be greater than 0 at project completion.
Submit an MS Excel file showing your completed calculations and including your responses to the indicated question
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