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7/31/2019 Project Monitoring (Tung)
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Topics for Today
Cycle of planning-monitoring-control
Report process
The concept of earned value (EV) EV, PV, AC
CPI, SPI
Purposes and types of control Practice of project control
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The basic feedback loop ofcontrol
PLAN ACTUAL
Find
cause
Corrective action
VARIANCE?
New Plan
Forecast to
complete
yesno
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Control SystemExample
1. Periodic status checking will be performed monthly2. Labor costs will be collected manually and estimated where
necessary from discussion with Group engineeringmanagement.
3. Out-of-pocket costs will be collected through commitments
and/or invoice payment records.4. Monthly status reports will be issued by the PM&C Program
project manager including:a. Cost to date summariesb. Cost variances.
c. Schedule performance relative to schedule in Ganttformat.d. Changes in scope or other modifications to plan.
5. Informal control will be exercised through milestoneanticipation in the PM&C Program project manager
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Gantt Schedule Chart
Example
Figure 15.4
JobDay
1Day
2Day
3Day
4Day
5Day
6Day
7Day
8
A
B
C
Now
Maintenance
Start of anactivity
End of anactivity
Scheduledactivity timeallowed
Actual workprogress
Nonproductiontime
Point in timewhen chart isreviewed
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Earned Value (EV or BCWP) is thebudgeted value of work performed.
Planned Value (PV) is also called BCWS budgeted cost of work scheduled.
Actual Cost (AC) is also called ACWP actual cost of work performed.
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SV (schedule variance) = EV PV a negative value isbad (behind schedule)
SPI (schedule performance index) = EV/PV a value less
than 1 is bad
CV (cost variance) = EV-AC a negative value is bad(over cost)
CPI (cost performance index) = EV/AC a value less than1 is bad; equal to 1 suggests being on target; over 1says under budget.
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The Earned Value Calculations
50-50 rule
0-100 percent rule
Critical input use rule The proportionality rule
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Management Information System
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Designing the MonitoringSystem
1. Identify key factors to be controlled
Performance
Cost
Time
2. Information to be collected must beidentified
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Test your knowledge
1. What does a cost performance index(CPI) of 1.0 suggest?
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That the project is on budget
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2. What does a schedule Performance Index(SPI) of 0.80 mean?
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We are only progressing at 80% of theschedule.
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How do you interpret the CPI (costperformance index) = 0.7?
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CPI = EV/AC = 0.7
It means that for each $1 actually spent,only $0.7 worth of work has beencompleted cost inefficient.
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Group Discussion Assignments
G1&2: Discuss the benefits of timely, appropriate, detailed information. Howcan a value be assigned to these characteristics?
G3&4: What are the advantages for a PM of having a computerized systemover a manual one? The disadvantages?
G5&6: A project is usually a one-time activity with a well-defined purpose.What is the justification of setting up a PMIS for such a project?
G7&8: The earned value chart is an attempt to put the three-dimensionalconcept of Figure 1.1 (see Chap 1) into a two-dimensional format. Is itsuccessful?What is missing?
G9&10: How might a variance be traced back to its source?
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